Aon Ireland Reveals Top 5 Risks for Irish Businesses in 2025

Peter Brady, Head of Risk Capital at Aon Ireland, has revealed the top five risks facing Irish businesses in 2025, outlining the importance of leaders putting in place strategies that mitigate against these challenges in 2025.

The emergence of a more protectionist trading environment and heightened geopolitical instability look set to have a significant impact on Irish businesses in the months ahead. With flooding, wildfires and other extreme weather events becoming increasingly frequent, Aon Ireland is forecasting that business leaders will need to take greater action to prepare against climate risk this year. Other key challenges ahead include the growing risk posed by evolving cyber and AI capabilities and the complexities created by forthcoming regulatory and legislative changes.

“While Irish businesses have navigated challenges well in recent years, a heightened state of volatility is set to become the new normal this year, said Peter Brady, Head of Risk Capital at Aon Ireland. “In this increasingly complex environment, defined by major shifts across the areas of trade, technology, weather and workforce, leaders should expect the unexpected.

“From navigating a more turbulent geopolitical and economic environment to managing the impact of increasingly frequent extreme weather events, leaders are set to face a range of fast evolving risks this year. The path forward for leaders demands agility, foresight, and a commitment to innovation.

By embracing these principles and taking proactive steps today, organisations can turn challenges into opportunities and ensure a resilient, successful future in an unpredictable world. At Aon Ireland, we’re proud to support leaders across the country make better decisions across technology, trade, weather and workforce to grow and protect their business.”

The Top 5 Risks include:

1. Digital disruption intensifies as cyber and AI risks evolve

While advances in AI, cyber and data technology are helping companies operating in an increasingly digital world gain a significant competitive edge, they also introduce new and evolving risks. In 2025, businesses will need to ensure they identify and mitigate against these risks as AI quickly becomes a key component of their innovation strategy. In 2025 we can expect a proactive approach from many businesses in managing the risk, with more than 9 in 10 (94%) Irish businesses enacting a plan or reviewing processes to mitigate against cyber risk, according to Aon’s GRMS.

2. Economic uncertainty grows as protectionist trade policies emerge

The potential introduction of trade barriers and protectionist trade policies could trigger significant disruption to economic and business growth in 2025. According to the Central Bank, these risks could have a significant impact on Ireland’s economic model as a small and open international economy, reliant on international trade. Irish businesses are not alone in experiencing heightened economic uncertainty. IMF Chief Kristalina Georgieva recently warned that the global economy is at risk of an economic slowdown, due to the shifting international environment. Leaders will need to ensure they have a clear strategy to manage these challenges and grow and protect their business in 2025.

3. Climate risk climbs up the business agenda

From wildfires to flooding, extreme weather events are becoming increasingly frequent and more severe in Ireland and across the globe. The potential impact of climate risk on business in 2025 is wide and can affect a broad range of operations, from significant damage to business assets, to workforce health and safety.

As leaders plan ahead, they must be increasingly conscious of climate risk and take action to prepare – climate change is the fourth highest future risk for Irish business according to Aon’s latest GRMS. Data and analytics tools can support companies shape decision making around the issue of weather and climate risk, enabling them to develop strategies to close the protection gap in 2025.

4. Geopolitical instability puts supply chains under pressure

Geopolitical instability has emerged as a top concern for businesses and has the potential to impact supply chains and other business critical functions in 2025 and beyond. According to findings from Aon’s Global Risk Management Survey (GRMS), supply chain risk or disruption failure is one of the top three current risks facing firms in Ireland.

The impact of increased geopolitical volatility has become clear in recent months in the Middle East with disruption to shipping routes through the Red Sea. As a new era of international trade dawns, firms may need to consider how to enhance the security of their supply chains in 2025 to support continued growth.

5. Landmark regulatory changes to take centre stage in 2025

From the implementation of the landmark EU AI Act to the expanded roll out of the Corporate Sustainability Reporting Directive, a raft of regulatory changes are on the horizon that will have significant implications for businesses in 2025. These new rules will provide important opportunities for business to enhance their future competitiveness and meet the growing demands of investors, customers and other stakeholders for stronger ESG reporting.

However, they are also set to create additional complexities and challenges in the short term. Given the seismic change required to prepare for some of this new legislation, it is critical that leaders are agile and act early to prepare for the landmark changes ahead.

Learn more about Aon in Ireland at: www.aon.com/ireland/.