Now that the United Kingdom has voted to leave the European Union (AKA the “Brexit”), risk management professionals everywhere are going to have to figure out how many different ways the split could affect their organizations.
While there are a lot of long-term questions to be answered, some immediate effects are clear: oil prices have dropped, the stock markets are panicking, and the value of the Euro and the British Pound have cratered.
From a business continuity and resilience perspective, one major area to consider will be supply chain, as any UK-based company that trades in the EU could face increased costs and supplier instability. In a worst-case scenario, other EU member countries may also choose to leave, creating even greater supply disruptions.
Another area to keep an eye on: cyber security. According to a poll by Unified Security Management, 38% of IT security professionals fear the UK will be more vulnerable to cyber attacks because they won’t have the benefit of intelligence sharing from other EU states, while 25% worried that corporate data may be less secure post-Brexit.
Still unknown is how employment will be affected throughout Europe and the UK. According to one survey by the Institute of Directors, a quarter of British companies are planning to freeze recruitment, and 5% said they are planning to cut jobs.
If there is a positive aspect to all this, it’s that the potential effects of the Brexit – and how to cope with them – have been on this industry’s radar since the vote was first announced. In fact, it was a featured item in the DRI Future Vision Committee’s 2016 Forecasts & Predictions report, available for download in the MyDRI resource library.