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2023 IRMSA risk report now available

ARTICLE BY

  • IRMSA
  • The Institute of Risk Management South Africa

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The Institute of Risk Management South Africa (IRMSA) has published its highly anticipated 9th Edition of the Annual Risk Report, sounding a new alarm on South Africa’s escalating poly-crisis.

The report emphasises the urgent need for strategic and comprehensive actions to address the interplay of multiple predicaments that threaten the nation’s stability and progress.

A poly-crisis is characterised by the occurrence of numerous crises simultaneously or in rapid succession, resulting in complex and interconnected challenges for governments, organisations, and societies.

IRMSA’s Chief Risk Advisor Christopher Palm says: “Over the past eight years, South Africa has faced recurrent risks that have persisted and intensified, paving the way for the current situation.

Economic challenges, including stagnant growth, high unemployment, and persistent inequality, have consistently ranked among the major risks facing the country.

Concerns over corruption, governance, the rule of law, and breakdowns in public service delivery have also been recurring themes.”

The report says South Africa has experienced a surge in social unrest, with protests and riots fuelled by issues such as inadequate service delivery, poverty, inequality, unemployment, and political corruption.

Environmental risks, particularly related to climate change, extreme weather events, and water scarcity, have also emerged as significant concerns. Furthermore, technological disruption, cyber vulnerabilities, and the rise of artificial intelligence and automation have added to the complexity of the poly-crisis.

IRMSA’s report highlights the urgent need for South Africa to address these risks collectively. The country, says the institute, must urgently respond to the impacts of climate change, resolve the persistent energy crisis, and confront a deteriorating infrastructure situation.

Palm says ethical and visionary leadership, along with measures to address persistent inequality and unemployment, are essential for sustainable progress.

“If left unaddressed, the consequences of the poly-crisis could lead South Africa toward becoming a failed State, or worse a mafia State. IRMSA Risk Reports have repeatedly emphasised the outcomes associated with these risks, which have materialised to varying degrees. In addition to domestic challenges, South Africa must also navigate international threats and opportunities, such as changing global trade patterns and geopolitical tensions.”

The 9th Edition of the IRMSA Risk Report serves as a wake-up call for South Africa and its stakeholders, emphasizing the critical need for immediate and concerted action. By acknowledging the poly-crisis and taking decisive steps to treat its impact, South Africa can work towards a resilient and prosperous future.

In response to the current risks facing South Africa, IRMSA says these are the

proposed risk-response strategies the country should be adopting:

  1. Prioritising policies and investments that foster economic growth, stimulate job creation, and provide economic support. Emphasis should be placed on sectors with significant potential for job generation, including green industries, technology, and tourism.
  2. Tackling high levels of inequality through the implementation of policies promoting social and economic equity. Measures such as progressive taxation, enhanced access to education and healthcare, and land reform should be employed.
  3. Investing in education and skills development to enhance workforce quality, promote innovation, and increase overall productivity.
  4. Creating a supportive environment for entrepreneurship and Small, Medium, and Micro Enterprises (SMMEs). This should include encouraging innovation, providing access to finance and business support services, and streamlining bureaucratic processes.
  5. Strengthening governance and combating corruption by fostering transparency, accountability, and democratic institutions. Measures should be taken to uphold the rule of law, ensuring equal treatment for all citizens.
  6. Investing in public infrastructure, with a focus on digitising basic public services, improving energy and water resources, and enhancing public transportation.
  7. Addressing the challenge of climate change through the promotion of sustainable development, reduction of greenhouse gas emissions, and preservation of biodiversity and natural resources.
  8. Promoting innovation, research, and development to boost high-tech industries and enhance the country’s competitiveness on the global stage.
  9. Combating crime and violence through increased investment in law enforcement, improvements to the criminal justice system, and addressing the root causes of criminal activity.
  10. Adopting a comprehensive and integrated approach to risk management, including the establishment of effective early-warning systems and disaster preparedness.
  11. Strengthening international partnerships and engaging more effectively with the global community.

IRMSA says these risk-response strategies are not new. However, what is needed are bold leadership and equally bold decisions to address these threats and opportunities facing South Africa.

By aligning with government priorities, they pave the way for sustainable growth, increased social equity, and a stronger presence on the international stage

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