New Delhi, July 11: Rising price of raw materials and high taxation have emerged as biggest threats to corporates in the Asia Pacific region, says a survey.
According to Lloyd's Risk Index 2013, Asia Pacific executives termed currency fluctuation, inflation, loss of customers/cancelled orders as the next three top risks facing their organisations.
When the study was last conducted in 2011, price of material inputs ranked 12th on executives' list of risk concerns, the index noted.
Talent and skills shortage was the prime concern for corporate houses in 2011.
“The price of raw materials is seen as the top risk, reflecting the importance of manufacturing to the region, and the rising cost of materials across a range of sectors. It has soared up the risk index ranking from 12th to 1st place in the last two years,” the survey noted.
The risk index surveyed 558 executives across the world during April and May. Respondents were questioned about 50 risks across five categories — business, strategic and economic; regulatory and market; political, crime and security; environmental and health; and natural hazard.
“With costs of many raw materials rising, businesses in the Asia Pacific region are understandably concerned about managing this expenditure. Yet the danger is that an emphasis on near-term, operational issues comes at the expense of significant, strategic decisions that have previously exercised business leaders,” Lloyd's CEO Richard Ward said.
“With the timetable for global economic recovery likely to be much longer than we hoped, focus on long-term sustainability and effective risk management should be a priority for boards across the world,” he added.
