Swiss Re and LSE report rising interconnection in global corporate risks

A joint analysis by the Swiss Re Institute and the London School of Economics (LSE) reveals a 24 percent increase in the interconnection of global corporate risks since 2019. Based on a study of 91 Fortune 100 companies, the report identifies artificial intelligence (AI) and supply chain dependencies as primary nodes that allow technological, geopolitical, and climate-related disruptions to cascade across different sectors.

Risk reporting related to AI and new technologies has risen by approximately 30 percent, with these concerns spreading beyond the IT sector into industries such as retail, pharmaceuticals, aviation, and food production. Simultaneously, mentions of climate risks have increased by about 31 percent since 2019. The study highlights the vulnerability of physical infrastructure supporting these technologies; for example, over a quarter of US data centers are located in areas prone to frequent large hail events, and more than 40 percent are in significant tornado zones.

Experts warn that increasing reliance on shared suppliers, technology platforms, and critical infrastructure means a single disruption can impact multiple seemingly independent economic areas. The findings suggest that systemic crises may increasingly depend on the location and reach of a shock rather than its initial size.