Lloyd’s and NATO have joined forces and hosted an event to discuss the threats and potential solutions to some of the biggest risks facing society.
At the Lloyd’s 360 live debate “Managing Risk in the 21st Century,” leading experts discussed climate change, cyber security and piracy in front of 200 insurance industry professionals, business leaders, and government representatives.
Co-operative solutions
Today’s sophisticated, industrialised and complex world is under attack from a myriad of determined and deadly threats, said Lord Levene, Chairman of Lloyd’s and co-host of the event held in London on 1 October.
But, compared with the past, society has more tools at its disposal.
Society’s stronger scientific, technological and political grasp of risk, means that it does not need to “labour too long or too hard” on the nature of the risk, and instead can concentrate on the solutions, he said.
Coalitions between business, governments and non-governmental organizations are also an important part of the solution, Levene commented. “In the modern era, we are able to form new alliances to fight our common threats.”
Events like the one co-hosted by Lloyd’s and NATO in London bring a range of different voices to the table, and this gives added perspective.
No one party can bring the rule of law to Somalia and end piracy off the Horn of Africa, or cut global emissions to reduce the threat of global warming, said Lord Levene. “But these things are not beyond the limits of collective action.”
Common threats
While a partnership between the world’s leading speciliast insurance market and NATO may seem an unusual pairing, just such alliances are needed if solutions to global threats like climate change are to be found, according to Anders Fogh Rasmussen, Secretary General of NATO.
Both Lloyd’s and NATO are in the business of managing risk, said Mr. Fogh Rasmussen in his address: “We are both focused on predicting threats, taking steps to reduce their likelihood, and, when necessary, managing the effects.”
Risks affect business, governments and non-governmental organizations alike and cut across the divide between the public and private sectors, Mr. Fogh Rasmussen said.
For example, ship owners and insurers are faced by the threat of piracy, and NATO, the European Union and many governments have had to send naval forces to defend against attacks.
Governments and industry also both suffer the consequences of cyber attacks, in terms of lost revenue, lost data and lost services, said Mr. Fogh Rasmussen. “It will take co-operation between the public and private sectors to build real defences.”
Climate change is also a major threat, and could lead to more natural catastrophes, rising sea levels, falling food production and political unrest, said Mr. Fogh Rasmussen. The response to the challenge of climate change can not come exclusively from the military, and will require government and industry action and partnerships, he added.
Climate – an opportunity and a threat
Pen Hadow, polar explorer and leader of the Catlin Arctic Survey, said that the Arctic sea ice may cease to be an all-year-round feature of the planet within our life times.
The seasonal disappearance of Arctic sea ice would create both opportunities and threats to business, he said in his presentation. It will open up new shipping lanes, fishing grounds and make access to the region’s oil and gas resources possible, but it will also have negative implications for global warming closer to home.
The Survey, which is providing scientists and policy makers at the December Copenhagen climate negotiations with important data on global warming, was supported by Lloyd’s.
Good business sense
There is a strong business case for developing a response to climate change, and companies should recognise the opportunities in doing so, said David Smith, Chief Executive at Global Futures and Foresight.
This is a “defining moment” for business, he said. The time has come for business to explore the opportunities in sustainable development and differentiate themselves from their competitors.
“Setting goals as a leader on environment, social and ethical management, can make an organization more attractive to consumers, suppliers, lenders, investors, new talent and insurers, and can reduce cost and waste in operations,” Mr. Smith said.
Public private partnerships
Business and governments must work closer together if they are to tackle cyber security risks, said Jaak Aaviksoo, Minister of Defence for Estonia.
In 2007 Estonia was subject to a massive nation-wide cyber attack during a dispute with Russia over the moving of a war memorial. Estonia’s experience showed the need for government and private organizations to work together to build their cyber defence capabilities, Mr. Aaviksoo said.
Co-operation has also been a feature of dealing with the threat of piracy off the coast of Somalia and in the Gulf of Aden, said Efthimios Mitropoulos, Secretary-General of the International Maritime Organization. In an “unparalleled demonstration of solidarity,” the United Nations, governments and non-government organizations have formed alliances and taken measures to tackle the piracy risk, he said.
