As the year begins, disruptive forces such as economic volatility, cyber risk, workforce issues and extreme weather seem to be intensifying. On virtually all fronts, operational risks continue to threaten an organization’s safety, productivity and sustainability. Here is our summary of the top 10 operational risks for 2025.
1. Cybersecurity threats
In January, the FBI warned of hacker attacks targeting critical infrastructure, including power plants and electric grids, water treatment plants, oil and natural gas pipelines and transportation hubs.
Cyberattacks can cripple operations or result in downtime, which contributes to operational risk. Disruption in the supply chain can delay critical maintenance, not only when systems are down, but also during recovery.
A 2024 survey by IBM estimates the average cost of a data breach at $4.88 million, up from $4.45 million in 2023. To avoid the high costs and consequences of cyber incidents, companies must keep their security up to date. This includes understanding their suppliers’ cyber risk status.
2. Physical security threats
Companies are needing to invest in more stringent facility security to protect people, assets and locations. Businesses must also meet international standards such as the API 780 and ISO 27001 to assure customers that they take security seriously.
Organizations should perform security risk assessments using the latest technology because perpetrators are becoming more sophisticated. Risk is a moving target, and regular security updates are critical. Companies have to take an “evergreen” approach. If an incident occurs, the risk assessment must be re-examined to close any loopholes.
3. Workforce turnover and retention
Companies all over the world are grappling with significant “brain drain.” Particularly for new employees in high-risk environments, organizations will need to ramp up process safety measures. These include safety training, shift handover communication, permit to work, contractor safety management and activity risk management.
According to 2024 research by Deloitte, a majority of executives (54%) plan to prioritize talent acquisition and transformation. Businesses that haven’t deployed digital solutions for operational risk management (ORM) and process safety management (PSM) are missing out on resources that can lower risk and boost safety and productivity, while helping companies cope with the loss of expertise.
4. Economic volatility
In recent years, geopolitical tensions are among the forces that have caused economies to fluctuate. Companies are still adapting to financial pressures such as high energy prices. Macroeconomic challenges have also put supplier viability in jeopardy. Supplier insolvencies remain a top concern, according to the Sphera Supply Chain Risk Report 2025.
In Gartner’s 2024 CEO and Senior Business Executive Survey, 61% of respondents see persistent inflation and low economic growth versus solid growth and reduced inflation. By monitoring changing economic conditions, companies have a better overview of emerging risk, including the regions where subsidiaries or partners are based.
5. Digital resistance
To support the energy transition, organizations must increasingly mine, handle and store substances and materials needed for things such as batteries or solar panels. This means that ORM and PSM professionals must be prepared to manage the accompanying hazards.
According to Sphera’s 2024 Process Safety Report, 66% of companies cited disparities between process safety goals and reality, despite technology advances that bridge the gap between safety intent and achievement.
Organizations can no longer rely on disparate, manual solutions for process safety. To embrace innovation and increase safety, companies must move from digital resistance to digital resilience. Leveraging digital tools effectively will be key to mitigating operational risk.
6. Not integrating risk management
According to United Nations data, an estimated 2.78 million workers die annually from occupational accidents and work-related diseases, while an additional 374 million workers suffer from non-fatal occupational accidents.
Identifying potential hazards and understanding their consequences remain challenging. To work smarter (and not harder), businesses can leverage digital technology to enhance risk visibility and provide a clear action plan.
A new era of proactive risk management has emerged, one that demands agility and foresight. In Sphera’s 2024 Process Safety Report, 89% of respondents believe risk awareness and safety would improve if the workforce and management had access to real-time (digitized) process safety risk indicators.
7. Regulatory compliance issues
Thanks to regulations such as the Corporate Sustainability Reporting Directive and Corporate Sustainability Due Diligence Directive, businesses’ supply chains, GHG emissions, plant maintenance and process safety, among other things, are coming under scrutiny.
Regulatory requirements, safety regulations and standards are typically revised over time, so ensuring that processes align with current standards is crucial. Yet many businesses feel overwhelmed. According to a CEO survey by PwC UK, nearly half (47%) of respondents see regulatory change as a threat to businesses’ ability to thrive.
Digitalizing their ORM and PSM processes helps companies collect accurate, relevant data; simplifies their reporting efforts; and ensures compliance.
8. Poor sustainability performance
In the aftermath of incidents such as a chemical gas leak, the costs arising from production downtime and environmental cleanup are joined by damage to an organization’s reputation. Negative publicity, social media backlash or ethical lapses can tarnish a company’s image overnight.
According to the Reputation Dividend report by Echo researchers, in the industrial sector, 29% of a company’s market value is attributed to its reputation. Operating a well-run facility is truly the baseline for safe and sustainable operations. It’s time for companies to communicate and emphasize that connection.
9. Extreme weather and emergency events
Preparing for and responding to emergencies such as extreme weather events require ongoing training and resources. Through climate risk adaptation, companies reduce their vulnerabilities and can protect people and assets.
According to the 2024 Corporate Climate Adaptation Survey by professional services firm Marsh McLennan, 41% of organizations are investing in asset engineering to better withstand extreme events without downtime.
Improving facilities to adapt to climate risk must be supported by training and action plans to ensure that personnel are adequately prepared. Organizations need to have safe work practices and emergency response plans in place.
10. Supply chain disruption
Disruptions in the supply chain, whether caused by natural hazards, geopolitical unrest or supplier issues, can delay production schedules, increase costs and strain relationships with customers.
In their Supply Chain Resilience Report 2024, the Business Continuity Institute revealed that nearly 80% of organizations experienced at least one supply chain disruption in the preceding 12 months.
Monitoring and mitigating supply chain risks, diversifying suppliers and implementing contingency plans help maintain business continuity in the face of risk events.
In 2025, businesses will continue to face a myriad of operational risks and supply chain challenges. By leveraging the right data and digital tools, ORM and PSM professionals can address key risks and improve decision-making. This fosters a safer work environment and reduces incidents while boosting productivity and sustainability.
