Over the years, cyber attacks and data breaches became one of the biggest risks in the business sector, compromising sensitive data and causing a massive financial hit to companies and organizations worldwide.
According to data presented by BuyShares.co.uk, more than 40% of companies feel threatened by cyber incidents and find it the most concerning business risk in 2021.
Business Interruption, Pandemic and Cyber Incidents Top Three Risks for Businesses
The global concern about cybercrime, IT failure, and data breaches has been on the rise for years. Before the pandemic, cyber incidents were the number one business risk globally, causing companies across the globe to spend billions on cybersecurity products and services.
Although cyber incidents are still one of the top three concerns for companies and organizations, the COVID-19 did affect the ranking of the biggest risks in the business sector.
According to the Allianz Risk Barometer survey, business interruption tops the charts as the leading business risk in 2021. Statistics show this risk has been in the number-one spot seven times over the last decade. However, the pandemic has made awareness of business interruption even stronger. That doesn’t surprise considering that 94% of surveyed companies reported a COVID-19 related supply chain disruption last year.
The pandemic outbreak has climbed 15 spots to become the second-most significant business risk, with 40% of companies worrying about this kind of uncertainty.
Cyber incidents ranked as the third-largest business risk globally, primarily due to the pandemic-fuelled rush towards digitalization. According to the survey, businesses all over the world recognize cybercrime as a more significant problem than loss of reputation, macroeconomic developments and political risks.
Market developments, including market volatility or fluctuation, intensified competition, new entrants, and mergers and acquisitions, ranked as the fourth-largest risk in the business sector this year, with a 19% share among respondents.
Changes in legislation and regulation, like trade wars and tariffs, economic sanctions, Brexit, and Euro-zone disintegration, close the top five list with also a 19% share, respectively.
Global Spending on Cybersecurity Products and Services to Hit $131.8B in 2021
Companies and organizations worldwide are losing billions due to cybercrime each year. Although most of them significantly increased their cybersecurity budgets, data breaches, phishing, ransomware attacks, or cyber espionage are still a huge threat to their operations.
Last year, consumers, businesses, and organizations worldwide spent over $120bn on cybersecurity products and services, $8bn more than before the pandemic struck. The Statista survey showed this figure is expected to grow by 10% YoY to $131.8bn in 2021.
Cybersecurity services, like data risk analysis, data masking, and vulnerability discovery, are the largest and the fastest-growing sector of the entire market expected to reach a $61.4bn value this year.
Cybersecurity software and hardware follow with $44.3bn and $26bn in revenue, respectively. By 2025, the global cybersecurity revenues are forecast to touch $210bn.