Business decision-makers are becoming ‘paralysed’ by constant crisis and their excessive caution is limiting growth opportunities, a new report from accountancy and business advisory firm BDO has warned.
In total, 84% of international business leaders surveyed as part of BDO’s annual Global Risk Landscape Report 2025 said the global risk landscape is now, more than ever, defined by crisis.
In response, executives are taking a much more defensive approach, with more than two thirds (69%) saying their companies are either ‘risk averse’ or ‘risk minimising’, a rise from 61% last year.
Only 7% of executives said their risk management was ‘very proactive’, down from 19% in 2024 and 29% 2023.
The report found that top six risks keeping business leaders up at night were regulatory risk, concerns over supply chains, recruiting and retaining talent, geopolitical tensions, environmental issues and cybercrime.
While regulators are demanding ever-more information about risks, some executives (39%) agreed that this had a positive impact in helping to make companies safer, but a larger proportion (57%) said regulatory demands were only ‘somewhat’ helpful in reducing company risk profiles.
However, CEOs surveyed were critical of compliance overspend, suggesting that current risk management strategies are failing to deliver value.
Alisa Voznaya, partner and head of risk consulting at BDO, said: “The risk landscape for businesses has been in flux for more than a decade and shows no sign of stabilising.
“Faced with this relentless volatility, some business leaders are being too hesitant to take decisions and paralysed by the fear of what could go wrong. But this safety-first approach means businesses are missing out on opportunities and limiting their growth prospects.
“Part of the problem is that businesses are increasingly taking a compliance-led approach to risk, with a box-ticking mentality distracting from the management of actual risks.
“Many would do well to adopt a more proactive approach, engaging in regular scenario planning and anticipating the things that could go wrong so they can start to identify opportunities. Businesses shouldn’t lose sight of the fact that there can be competitive gains to be made from responding positively to challenging circumstances.”
