What if the biggest threat to your business is one you haven’t even identified yet?
Emerging risks are reshaping industries at a rapid pace, from AI-driven fraud to regulatory crackdowns. Recent examples include AI-enhanced cyber threats, regulatory shifts driven by unstable political systems, and escalating climate-related disruptions.
As organizations navigate an increasingly complex world, the ones that fail to anticipate these evolving threats will risk severe financial, operational, and reputational damage. How prepared is your organization to adapt?
Risk management starts with defining your risk appetite. But how do you balance risk and opportunity? Download Risk Appetite for Dummies for a practical guide:
What are emerging risks anyway?
Emerging risks are unpredictable threats that evolve due to dynamic societal, technological, environmental, or economic changes. Unlike traditional risks, which are well-defined and supported by historical precedents, emerging risks are characterized by their novelty and potential for significant impact. These risks can arise from new technologies, evolving regulatory landscapes, or unforeseen global events.
Traditional risks typically involve predictable scenarios, such as natural disasters or economic downturns, where organizations can rely on historical data for effective management. In contrast, emerging risks lack a clear historical framework, making them inherently more challenging to identify and mitigate.
Understanding these new threats is crucial. Failure to recognize and manage emerging risks can lead to severe operational disruptions and financial losses.
The current landscape of emerging risks
The risk landscape in 2025 continues to evolve rapidly. Factors such as climate change, technological advancements, and geopolitical uncertainties are reshaping how organizations must approach risk management.
Gartner’s recent risk survey highlights that AI-enhanced malicious attacks have been the top emerging risk for enterprises for three consecutive quarters[1]. This underscores how generative AI is accelerating the sophistication of cyber threats, creating new vulnerabilities that organizations must address.
The World Economic Forum’s Global Risks Report 2025[2] identifies geopolitical instability, climate-induced resource shortages, and regulatory fragmentation as major threats requiring proactive risk mitigation.
One area where emerging risks have significant implications is liability insurance. As new risks materialize, insurance companies must adapt their policies to address evolving threats and liabilities. For organizations, understanding these risks is essential not only for risk management but also for ensuring adequate insurance coverage. A proactive approach to identifying potential liabilities can mitigate financial exposure and enhance overall resilience.
Identifying and managing emerging risks
Effectively managing emerging risks starts with proactive assessment strategies such as PESTLE (political, economic, social, technological, legal, environmental) and SWOT (strengths, weaknesses, opportunities, threats) analyzes[3]. These methodologies help businesses identify potential risks and their implications in a structured way. Horizon scanning allows organizations to monitor and analyze trends that could signal emerging risks, enabling them to prepare for potential challenges.
Identifying risks is only the first step. The next challenge is ensuring governance structures are in place to support a proactive response. Organizations should establish clear policies and processes to oversee risk management activities, ensuring accountability and transparency. Engaging stakeholders – including industry experts, regulators, and customers – can provide valuable insights and foster a culture of proactive risk management.
To integrate emerging risks into operational frameworks, businesses need to embed risk assessments into their decision-making processes. One challenge is quantifying emerging risks, as they often lack historical data. Organizations can overcome this by relying on expert judgment, scenario analysis, and risk modelling techniques to estimate potential impacts and likelihoods.
The business impact of emerging risks
Failing to address emerging risks can have severe financial repercussions. Organizations may face increased costs due to unanticipated disruptions, legal liabilities, or reputational damage. Conversely, businesses that proactively manage these risks can build resilience and gain a competitive edge.
For example, the COVID-19 pandemic demonstrated how emerging risks can disrupt global industries. Organizations that proactively identified operational and supply chain risks were better equipped to navigate the crisis. Similarly, climate change presents a substantial emerging risk, affecting everything from regulatory requirements to physical damages. Companies investing in sustainable practices can mitigate these risks while capitalizing on new market opportunities.
Technological disruptions, such as artificial intelligence and automation, introduce both risks and opportunities. Organizations that embrace innovation while managing associated risks can stay ahead in their industries. The EU AI Act is a key regulatory development that will reshape AI governance, requiring businesses to ensure transparency, accountability, and compliance in their AI-driven operations[4].
Conclusions and next steps for your organization
The risk landscape will continue to evolve, requiring organizations to remain vigilant and adaptable. Regularly reviewing and updating risk management strategies is essential for staying ahead. A hybrid approach – combining traditional risk management frameworks with innovative methodologies – can enhance an organization’s ability to manage emerging risks effectively.
Anticipating legislative and regulatory changes is another critical aspect of future-proofing. Organizations must ensure compliance and proactively adjust their risk management strategies in response to new regulations such as the EU AI Act and emerging climate disclosure requirements.
But managing emerging risks isn’t just about awareness – it’s about action. Organizations need real-time visibility to track risks as they evolve, connect risk indicators to controls, incidents, and emerging threats, and generate data-driven insights to drive better decision-making.
Protecht ERM provides a central hub for tracking and managing emerging risks, giving you:
- A real-time view of emerging risks linked to KRIs, controls, and incidents
- Automated risk reporting to highlight critical risk trends
- Custom dashboards to visualize risk exposure across the enterprise
- A structured, single source of truth for risk monitoring and response
Request a demo today and see how Protecht ERM can help you anticipate, track, and mitigate emerging risks before they escalate:
