Those Responsible for 90% of World’s Oil Reserves Express Concern about Their Full Understanding of the Emerging Risks They Face
NEW YORK, April 24 2007 – Less than 10% of National Oil Company (NOC) leaders surveyed by Marsh Inc. strongly feel they have a full understanding of the risks they face and how to effectively manage them.
This finding was contained in a new study released today by Marsh, the world’s leading risk and insurance services firm, examining risks and operational challenges among state-owned oil enterprises. Marsh gathered much of the data from a recent groundbreaking global risk advisory meeting held in Dubai and attended by approximately 250 leaders from NOCs, government and academia.
“The Impact of Risk on National Oil Companies,” available at www.marsh.com, also reveals a strong desire by NOC leaders to understand risk better and find better ways to share related best practices. More than 90% of the NOC leaders Marsh polled agreed that more discussion forums were needed.
“The spectrum of risk that business leaders face today is far more complex than ever before,” said Brian Storms, chairman and CEO of Marsh. “Not too long ago, the top concern for an NOC might have been a fire at a refinery. But the study we conducted at the Marsh National Oil Companies Conference in Dubai shows that newer risks – such as the impact of climate change – are moving near the top of the list.”
Storms added: “As the world’s premier broker, we will continue to provide clients with unrivaled excellence in insurance placements. But we’ll also deliver the best in business risk advice to help clients like NOCs go beyond risk transfer and turn their potential liabilities into competitive advantages.”
Andrew George, Marsh’s Marine & Energy leader in Dubai, said: “We’re hopeful the many eye-opening findings contained in this new research will help accelerate an open dialogue on the risk issues and business challenges NOCs face. Our mission is to promote greater awareness and collaboration among companies that are assuming critical leadership roles in the global energy market.”
Marsh also cited other potential risks faced by national oil companies, including the potential for a terrorist act to halt distribution, the effects of a major natural disaster on production, the potential vulnerability of supply chains – especially due to the threat of avian flu, as well as a variety of operational risks, reputation risks, strategic risks and financial risks.
In response to the findings within the report, Marsh said it will again sponsor and lead its second annual risk advisory conference for NOCs in February of 2008.
Marsh has 26,000 employees and annual revenues approaching $5 billion. The firm provides advice and transactional capabilities to clients in over 100 countries. Marsh is a unit of Marsh & McLennan Companies (MMC), a global professional services firm with approximately 55,000 employees and approximately $12 billion in annual revenues. MMC is also the parent company of Guy Carpenter, Kroll, Mercer, and Putnam Investments. MMC’s stock (ticker symbol: MMC) is listed on the New York, Chicago, and London stock exchanges. MMC’s Web site is www.mmc.com. Marsh’s Web site is www.marsh.com.Tags: Capgemini, Efma, InsurTech, World Insurance Report