• Cybersecurity work (US$16.5bn) now accounts for a quarter of the total market
• Environmental risk moves up the corporate agenda
• US risk services market hits US$35.1bn
The global risk services consulting market grew by 7.7% to reach a value of US$65.9bn in 2018 as companies turned to risk specialists to help them work out what steps they need to take to best manage emerging and sometimes hard to define risks.
Behind this market wide growth is a rising demand across a whole spectrum of risk services, with cybersecurity work now accounting for a quarter of the total market – growing faster than every other service line – but effectively cannibalising many other traditional areas of risk service provision. Other fast-growing areas include the much smaller risk transformation service line, and third-party assurance services.
These findings are published today (11th September 2019) in a new report,
The Risk Services Market in 2019, from
Source Global Research, the leading research and strategy firm for the global professional services industry.
The report also found that risks relating to sustainability and the environment are moving up the corporate agenda, thanks to headline-grabbing issues, increased legislation, and the fear of reputational damage resulting from a failure to adopt an environmentally aware approach. The impact of climate change is also leading to the development of new areas of risk management as clients seek support to develop strategies in the face of increased risks such as fire, flood, and drought.
In terms of the fastest growing markets within the global top 10, the huge US market performed well in 2018, with an 8.3% uptick in work to US$35.1bn. Also, rapid economic modernisation in China, and clients eager to participate in global markets, meant another year of strong growth (up 9.6%).
Nick Allan, CEO of Control Risks, who was interviewed for the Source report, said:
“The financial crisis killed a lot of environmental initiatives, but we`re now seeing governments really respond to this in quite a meaningful way. The Chinese government is really responding to the environmental concerns of their citizens. They`re trying to clean up pollution, and a lot of environmental technologies are being deployed in China.”
Automation is also changing the way that risk services are managed, by cutting out manual processes and removing the potential for error. However, the Source report points out that many clients are only just waking up to the possibilities: take-up could accelerate as more use cases are developed.
Zoë Stumpf, Head of Market Trends at Source Global Research, added:
“Risk services providers are having to change the way they operate, considering how far they want to go in terms of digitising services and the best way to achieve this. This automation of services is also starting to impact a number of different facets of service provision, changing the traditional pricing model and the type of talent needed, as well as boosting interest in the development of managed services and assets.”
The more heavily regulated sectors are those seeing the biggest uptick in risk services demand. Financial services work dominates, generating over a third of all risk service revenues, with demand growing 9.3% in 2018. The much smaller pharma market grew more than 12% in 2018, with healthcare not far behind.
Source Global Research estimates that the global risk services market will continue to grow strongly next year, with the market expected to increase by around 10% to the end of 2020—an even higher rate of growth than in the recent past.
For more information on Source reports contact
ella-sian.jolley@sourceglobalresearch.com, telephone +44 (0)20 3478 1204, or visit
www.sourceglobalresearch.com.
