Blog: The 2025 Global Risks Report
Olga Murray discusses the 2025 WEF Global Risk Report and strategies that can help companies build resilience.
21st January 2025
by Olga Murray
Olga Murray is a specialist climate and ESG advisor to board directors and law firms around the world. She is the Founder of Private Goodness which trains executives and lawyers, wins International CSR Excellence Awards, and delivers Innovate-UK funded projects.
This blog discusses what we can learn from the 2025 World Economic Forum annual report on Global Risks and strategies that can help companies build resilience.
Last week the World Economic Forum released its annual Global Risks Report which explores the key risks facing the world over the next decade. The report brings together the collective intelligence of over 900 global leaders across business, government, academia and civil society, as well as 100 thematic experts and risk specialists.
The report concludes most severe risks over the next two years are misinformation and disinformation, extreme weather events, state-based armed conflict and societal polarisation.
While over the ten years, the top four severe risks are all environment-related: extreme weather events, biodiversity loss and ecosystem collapse, critical change to Earth systems, and natural resource shortages.
Reference: Global Risks Report 2025, Figure C, page 8
Environment
The report begins with a stark and concerning assessment: 2024 saw six of the nine “planetary boundaries” for environmental health crossed, with a seventh boundary in jeopardy.(1) These boundaries are critical in maintaining the stability of the world’s life support system, including our economies and societies.
Climate change is an underlying driver of several other risks that rank highly, for example, involuntary migration or displacement.
While pollution doesn't dominate the news cycle, it is the world’s largest environmental risk factor for disease and premature deaths. Its impacts are unequal, with 92% of pollution-related deaths and the greatest burden of related economic losses occurring in low- and middle-income countries.(2)
State-based armed conflict
Global Risks Reports examine not only the direct impacts of risks - such as humanitarian crises caused by conflict, which can escalate into further conflict and devastation - but also the effects of how those risks are perceived.
Compared with last year, the risk of 'state-based armed conflict' has climbed from number 8 to number 1 in the rankings for 2025, and sits third for 2027.
“Perceived or actual threats from other countries also provide an opening for governments to seize control of narratives and suppress information, perhaps blurring the lines between genuine security considerations and political expedience.
These are all conditions that will help authoritarian regimes consolidate their power and may lead to democratic regimes taking on more authoritarian characteristics.”
World military expenditure increased for the ninth consecutive year in 2023, reaching a total of $2.4 trillion, with 2023 seeing a steep rise over 2022. At the same time, there is a declining investment in humanitarian aid and the size of the UN peacekeeping operations has been reduced from over 100,000 peacekeepers in 2016 to around 68,000 in 2024.(3)
The new U.S. administration will play a significant role in shaping events over the next few years. Additionally, we will observe whether tariff-based protectionism might result in a decline in global trade.
Misinformation
The top risk in 2027 is deemed to be misinformation and disinformation. It's increasingly difficult to tell what's true and what isn't, what is AI- and what is human-generated. The report also discusses algorithmic bias:
“Sometimes, the bias can be obvious. For example, in a hiring process, a set of bios used as examples of good candidates might be drawn from a pool of previous candidates, all of whom might have the same gender, race or nationality.
The personal biases of individuals designing the assumptions of the model can also play a role in leading to unjust outcomes”
Inequality and Societal polarisation
“This is an important pair of risks to watch, given how related they can be to bouts of social instability, and in turn to domestic political and to geostrategic volatility.”
This year the Global Risks Report focuses on demographic trends and pensions crises and labour shortages that can follow.
“Globally, the number of people aged 65 and older is expected to increase by 36%, from 857 million in 2025 to 1.2 billion in 2035.(4)”
Sub-Saharan Africa is home to many countries with youthful demographics but according to the International Labour Organisation, 72% of young adult workers (aged 25 to 29) in the region are engaged in forms of employment classified as “insecure”.(6)
One of the key challenges in the coming decade will be to generate enough good and secure employment.
Corporate Resilience Strategies
Although there are numerous risks on the horizon, companies can take proactive steps to safeguard their future. Here are the top five strategies businesses can implement to effectively prepare for the challenges ahead.
Diversify supply chains
Even with insights from the world’s leading risk experts, unexpected events still occur. To prepare for these uncertainties, companies should test and diversify their supply chains. Incorporate worst-case scenario planning to address the various risks outlined in this blog, ensuring resilience against disruptions.
2. Accelerate your company's green transition
Climate-related risks are expected to dominate the coming decade. Companies must accelerate their transition to greener practices, not only to meet environmental goals but also to help their communities and clients adapt to future climate-related challenges. Proactively integrating sustainability into your business strategy will be key to long-term resilience.
3. Enhance flexible work policies
To support a diverse and adaptive workforce, companies should expand their flexible work policies, offering options for employees to leave and rejoin the workforce at different life stages.
In addition, organisations can prioritise building cross-generational teams and investing in skill development to create a dynamic and inclusive work environment.
4. Boost digital literacy
Digital literacy is essential for employees to critically evaluate data, recognise misinformation and make informed decisions. Companies should invest in training programs that enhance these skills, enabling employees to navigate the increasingly complex digital landscape with confidence.
5. Forster collaboration and trust
The report emphasises that "by deepening honest dialogue and acting urgently to mitigate the risks that lie ahead, we can rebuild trust and together create stronger, more resilient economies and societies."
Final Words
This statement from last year’s report remains very relevant:
“The future is not fixed. A multiplicity of different futures is conceivable over the next decade. Although this drives uncertainty in the short term, it also allows room for hope.
Alongside global risks and the era-defining changes underway lie unique opportunities to rebuild trust, optimism and resilience in our institutions and societies.”
In spite of the many challenges the world is confronting, this analysis urges us not to give up, but to redouble our efforts in building a better future.
(1) Potsdam Institute for Climate Impact Research, Planetary Boundaries – defining a safe operating space for humanity, https://www.pik-potsdam.de/en/output/infodesk/planetary-boundaries.
(2) Fuller, Richard, Philip J Landrigan, Kalpana Balakrishnan, et al., “Pollution and health: a progress update”, The Lancet Planet Health, vol. 6, 2022, pp. e535-e547, https://www.thelancet.com/pdfs/journals/lanplh/ PIIS2542-5196(22)00090-0. pdf.
(3) United Nations Peacekeeping Operations, Global Peacekeeping Data, 31 August 2024, https://peacekeeping.un.org/en/ data.
(4) United Nations Department of Economic and Social Affairs, Population Division, World Population Prospects, 2024, https://population.un.org/wpp/.
(5) International Labour Organization (ILO), Global Employment Trends for Youth 2024: Sub-Saharan Africa, August 2024, https://www.ilo.org/sites/default/files/2024-08/Sub-Saharan%20Africa%20GET%20Youth%202024_0.pdf.
(6) International Monetary Fund (IMF), Regional Economic Outlook – Sub-Saharan Africa, April 2024, https://www.imf.org/en/ Publications/REO/SSA/Issues/2024/04/19/regional-economic-outlook-for-sub-saharan-africa-april-2024.
*This blog is kindly reproduced with the permission of Olga Murray, Founder of Private Goodness
People are growing in confidence that they have the ability to change society - Sir John Elvidge
Sir John Elvidge reflects on his six year tenure as Chair of the David Hume Institute
By Sir John Elvidge, former Chair of the David Hume Institute
A lot has changed since I became Chair of the David Hume Institute in September 2015. When I took up the role, the constitutional referendum was behind us, in time if not in terms of the lingering disunity through the heart of our society, the Brexit referendum was not in sight and Barack Obama was in his second term in the White House. The gradual global economic recovery from the banking crisis of the previous decade was proceeding steadily and, in Scotland, labour supply that could keep pace with rising employment was a more pressing challenge than unemployment.
Climate change was a well established focus of international high-level policy discussion but not, for most people, an issue which engaged people's everyday lives. Inequalities which we have failed for decades to resolve, notably in health and in educational attainment, persisted and, in some cases, were widening. Racial discrimination was an everyday reality for many of those living in Scotland who are not white or Scottish-born but we were reluctant to acknowledge something which challenged our image of ourselves.
Today the prevalent discourse proceeds from the belief that the reality we occupied in 2015 was the product of a “broken system”. There is a widespread desire to embrace a redefined statement of the future society and economy to which we aspire. This is engaging people in a way which it seemed difficult to do before the crisis, despite the fact that Scotland has been among world leading countries since 2007 in trying to articulate our shared aspirations through our National Performance Framework.
The David Hume Institute's recent work to listen to the views of a large number of people about their future aspiration and, crucially, their thoughts about the action we might take to get there provides strong evidence that this shared desire is an important part of the reality of 2021.
Finding the paths to fulfilling that shared desire is less straightforward. The Institute’s approach is to stimulate people to discuss and work together to answer those questions, rather than to start with a set of pronouncements. That isn't as easy as it might seem, particularly when the absence of ready answers to the questions can make some people uncomfortable and defensive.
The Institute has experience of the way in which a substantial evidence-based report seeking to inform discussion about tackling a long-term challenge with our economic performance, in the form of low productivity, can fail to bring change, despite the strength of the evidence. Although that report stressed that the challenge was by no means confined to Scotland, within the United Kingdom, and that the real worry is our poor comparison with other countries, we found that complacent comparison with the English regions was often used as a reason not to engage.
We have turned in recent months to a fresh approach, which starts from the questions with which people feel the strongest desire to engage. With the support of several committed partners and the willing engagement of over 4,000 participants, we have spent the past six months engaged in a process of discussion of what actions offer a pathway to a better future.
We have deliberately started from a focus on what individuals, communities and businesses can do to create change rather than by adding to the usual preoccupation with government policy changes. We have made sure that the discussion reflects the views of different parts of Scotland, recognising that the voices of those communities are often not heard with as much attention as the voices of our cities.
Thanks to our partners, we have been able to draw in the voices of young people, whose reliance on the best decisions about fulfilling aspirations for the future is greater than anyone else's and who bring open minds to the discussion. We have also sought to draw in those who would tend not to engage with traditional ways of exploring policy choices.
This is a discussion which will grow in volume and effectiveness. One reason for that is that we are building forward by highlighting what people are already taking the initiative to do, whether it’s businesses adapting to the dramatic changes or communities working together in new ways.
People are growing in confidence that they have the ability to change society, including the economy. Bringing people together with different backgrounds and experience in conversation has been powerful. We hope that will lead to continued engagement to allow positive change to gain momentum.
One of the distinctive features of this approach has been to treat the conventional focus on what governments should do as the final question in the chain, not the first question. One of the clearest lessons from the pandemic has been our reliance on the actions of the people who make up the fabric of our community at least as much as on the actions of governments.
I am pleased that the end of my period as Chair of the David Hume Institute coincides with the Institute placing itself at the heart of that opportunity to give voice to the practical wisdom of all parts of our society. I am grateful to the supporters whose funding has made this possible. I hope that others will add their support, in various ways, to enable the Institute to make the most of the opportunity.
Above all, I hope that people will join the thousands of our fellow citizens who have brought their voices and their actions to the vital process of working together to make Scotland a more prosperous, sustainable, inclusive and fair country. Every day, further practical actions by individuals can help achieve the shared aspirations for our future. The Institute's website offers an easy gateway to doing that.
This article originally appeared in The Scotsman on 29th March 2021.