Descriptions of Global Risks 2021
A “global risk” is defined as an uncertain event or condition that, if it occurs, can cause significant negative impact for several countries or industries within the next 10 years.
To ensure legibility, the names of the global risks have been abbreviated in the figures. The portion of the full name used in the abbreviation is in bold.
Global Risks Perception Survey and Methodology
The Global Risks Perception Survey (GRPS) is the World Economic Forum’s source of original risks data, harnessing the expertise of the Forum’s extensive network of business, government, civil society and thought leaders. Survey responses were collected from 8 September to 23 October 2020 among the World Economic Forum’s multistakeholder communities (including the Global Shapers Community), the professional networks of its Advisory Board, and members of the Institute of Risk Management. The results of the GRPS are used to create the Global Risks Horizon, the Global Risks Landscape, and the Global Risks Network presented at the beginning of the report, and to offer insights used throughout.
Both the GRPS and the Global Risks Report adopt the following definition of global risk:
- Global risk: A “global risk” is an uncertain event or condition that, if it occurs, can cause significant negative impact for several countries or industries within the next 10 years.
Updates in the GRPS 2020
New list of risks
The list of 35 global risks included in the survey was updated in 2020.
This year, 12 new risks were added as a result of observed economic, geopolitical, societal and technological trends, as well exacerbated or emerging trends from the COVID-19 crisis that have the potential to have long-term effects. These new risks are: (1) “collapse of a multilateral institution”, (2) “collapse of a systemically important industry”, (3) “collapse or lack of social security systems”, (4) “digital inequality”, (5) “digital power concentration”, (6) “failure of technology governance”, (7) “fracture of interstate relations”, (8) “geopolitization of strategic resources”, (9) “pervasive backlash against science”, (10) “prolonged economic stagnation”, (11) “severe mental health deterioration” and (12) “widespread youth disillusionment”.
The names and definitions of the remaining 23 risks have been revised and, where applicable, have been modified and/or expanded to reflect new ways in which the risks may materialize and the potential adverse outcomes they may cause. However, to ensure comparability over time, names and definitions were modified insofar as the fundamental concept of the risk remained consistent with previous versions of the survey. In three cases, previous risks considered to be different manifestations of the same risk were merged: (1) cyberattacks and data fraud were merged into “failure of cybersecurity measures”, (2) inflation and deflation into “failure to stabilize price trajectories” and (3) food crisis and water crisis into “natural resource crises”.
The GRPS 2020 features four new sections:
- Global Risks Horizon: recognizes that respondents may have varying perceptions on the evolution of global risks within a 10-year horizon.
- Global Risks Network: recognizes that respondents may be subject to different degrees of exposure to global risks, as well as to the existence of negative feedback loops by which global risks amplify each other.
- Global Risk Response: aims to complement risk identification with risk response by asking respondents to identify blind spots and opportunities for global response.
- COVID-19 Response: at the specific point in time during which the survey was conducted, this section compares how respondents perceive the effectiveness of the response to the COVID-19 crisis and its fallout at a global and regional scale.
The Global Risks Horizon
For each of the 35 global risks listed in Appendix A, respondents were asked to identify when they believe a risk will become a critical threat to the world, within the following timeframes:
- Short-term threats: 0–2 years
- Medium-term threats: 3–5 years
- Long-term threats: 5–10 years
A simple tally for each of the 35 global risks was calculated on this basis. The results are illustrated in the Global Risks Horizon 2021 (Figure I).
Global Risks Landscape
For each of the 35 global risks listed in Appendix A, respondents were asked to score (1) the likelihood of each global risk occurring over the course of the next 10 years and (2) the severity of its impact at a global level if it were to occur, both on a scale from 1 to 5, as follows:
- Likelihood: a value of 1 for “very unlikely” and 5 for “very likely” to occur over the next 10 years
- Impact: a value of 1 for “minimal” impact and 5 for “catastrophic” impact at a global level
To reduce timing bias, respondents were reminded to score each of the 35 risks over a 10-year period. To reduce framing bias, except for the extremes, the values within the 1–5 scale were not assigned specific wording. Respondents could leave the question completely blank. Partial responses for any risk—those scoring only the likelihood of occurrence or only the severity of impact—were not included in the results.
A simple average for both likelihood and impact for each of the 35 global risks was calculated on this basis. The results are illustrated in the Global Risks Landscape 2021 (Figure II).
Global Risks Network
From the list of the 35 global risks listed in Appendix A, respondents were asked to rank order the three risks they consider to be the most concerning, second most concerning and third most concerning for the world. The results were aggregated according to the following scoring scheme:
- 3 points each time a risk was selected as the most concerning risk
- 2 points each time a risk was selected as the second most concerning risk
- 1 point each time a risk was selected as the third most concerning risk
Respondents were then asked to select up to five risks they consider will be driving each of the risks that were previously selected as top concerns over the course of the next 10 years, in no particular order. Two risks could be selected as drivers of each other. For example, in the first step, a respondent could select “climate action failure” as the most concerning risk and “extreme weather events” as one of its drivers. In the second step, the respondent could select “extreme weather events” as the second most concerning risk and “climate action failure” as one of its drivers. However, a risk could not be selected as driving itself.
A simple tally of the number of times a risk was identified as a driver for each of the first, second and third most concerning risks was calculated on this basis. The results are illustrated in the Global Risks Network 2021 (Figure III). In that figure, the size of each of the most concerning risk nodes is scaled according to the above scoring scheme. The thickness of each of the links between a driver and a risk is scaled according to the above tally.
Global Risk Response
From the list of the 35 global risks listed in Appendix A, respondents were asked to rank order the three risks for which they consider the current global response falls short of their potential impact (“blind spots”) and the three risks for which they consider a coordinated global response has the most potential to prevent or mitigate (“opportunities”). The results for both categories were aggregated according to the following scoring scheme (see Figure B.2 Global Risk Response for a representation of the GRPS respondents’ response to risks):
- 3 points each time a risk was selected as the top blind spot or opportunity
- 2 points each time a risk was selected as the second blind spot or opportunity
- 1 point each time a risk was selected as the third blind spot or opportunity
Respondents were asked to rate the effectiveness of the response to COVID-19 in terms of protecting lives and livelihoods, globally and in their region, on a scale from 1 to 5 with 1 meaning a “complete failure” and 5 meaning a “complete success”.
Considering the different trajectories that COVID-19 has followed across countries and regions, a quantitative test was performed to check for timing bias in the responses to this question. Responses were evenly distributed in two groups according to their entry date. Average regional and global scores were then compared between groups. Significant differences were not found within the survey dates: on average, the regional score differed by 5 centesimal points (or 1.90%) between groups and the global score by 9 centesimal points (or 3.20%).
Figure B.1: Global Risk Response
We received 841 total responses to the GRPS to which we applied an overall standard deviation check and specific completion thresholds for each section of the survey:
- Part 1.1 – Impact and Likelihood of Global Risks: 664 respondents scored the impact and likelihood of at least one risk. Empty or partial responses for any risk—those scoring only the likelihood of occurrence or only the impact—were dismissed. 0 responses yielded a standard deviation of zero.
- Part 1.2 – Assessment of Global Risks: Horizon: 647 respondents placed at least one risk within a possible timeframe. Empty responses were dismissed. Four responses that yielded a standard deviation of zero (assigning numbers to the three possible timeframes) were dismissed. The remaining 643 responses were used to compute the results.
- Part 2 – Global Risk Drivers: 631 respondents ranked at least one concerning risk and assigned at least one driver. Three responses that contain the same risk in multiple ranks were dismissed. The remaining 628 responses were used to compute the results.
- Part 3 – Global Risk Response: 623 respondents identified at least one blind spot or opportunity. Empty responses were dismissed.
Blind spots: Six responses that contain the same risk in multiple ranks were dismissed. The remaining 617 responses were used to compute the results.
Opportunities: Six responses that contain the same risk in multiple ranks were dismissed. The remaining 617 responses were used to compute the results.
- Part 4 – COVID-19 Response: 626 respondents scored at least one level of response, either global or regional. Empty responses were dismissed.
- Sample distribution: the 664 respondents from Part 1.1 were used to calculate the sample distribution by place of residence, gender, age and area of expertise.
Figure B.2 presents some key descriptive statistics and information about the profiles of the respondents.
Figure B.2: Survey Sample Composition