Aon Global Risk Management Survey: Some Multinationals Not Ready for Risk

Aon Global Risk Management Survey: Some Multinationals Not Ready for Risk

April 24, 2007

    CHICAGO, April 24 /Xinhua-PRNewswire/ -- Multinational
corporations are facing increasingly diverse, complex and
exotic risks, and may not have all the resources in place
to manage them effectively, according to Aon's first Global
Risk Management Survey.

    More than half of the survey's respondents said they
weren't prepared for the risk they rated as most worrisome
-- damage to reputation.  "Executives now see
reputation as a major source of competitive
advantage," said Ruth Joplin, Aon Global Risk
Consulting managing director.  "While intangible,
reputation is one of the most important corporate assets
and one of the hardest to protect," she added. 
"The lack of preparedness reported for this and other
key risks is both surprising and somewhat worrying."

    Joplin says it should come as no surprise that business
interruption was cited as the second key risk.
"Preserving earnings power is clearly one of the top
priorities of senior management," she said, "and
there is a growing realization that the resulting loss of
income following an event could pose a greater threat than
the physical damage itself. While 70% of respondents
reported being prepared, it is perhaps even more telling
that 30% are not."

    Survey responses suggest that third party liability
risk concerns have arisen as a result of the encroachment
of U.S.-style litigiousness into other geographies. 
"The `compensation culture' is gaining a stronger
global foothold," Joplin said.

    Rounding out the top five risk concerns, based on the
survey's results, are distribution or supply chain failure,
and market environment. Lack of preparedness for these risks
is reported at 37% and 65%, respectively. What does this
mean? "There is clearly more work to be done,"
said Joplin. "Dealing with these and future risk
trends will require innovative, forward-looking
solutions."

    Other top ten risk concerns rated by survey respondents
are, in order, regulatory changes, failure to attract or
retain staff, financial risk, physical damage and mergers
and acquisitions and disaster recovery plan failure are
tied for tenth place.

     Ranking    Risk description
     1          -- Damage to reputation
     2          -- Business interruption
     3          -- Third party liability
     4          -- Distribution or supply chain failure
     5          -- Market environment
     6          -- Regulatory/legislative changes
     7          -- Failure to attract or retain staff
     8          -- Market risk (financial)
     9          -- Physical damage
    10          -- Merger/acquisition/restructing
                -- Failure of disaster recovery plan

    Joplin says that that Americas is the only region where
technology failure and loss of data are cited as a major
risk concern, while Europe uniquely cites
mergers/acquisitions/restructuring and Asia/Pacific is
highly concerned with weather/natural disasters.  Risk
managers in the Americas tend to rely heavily on senior
management intuition and experience to identify major risks
as compared to other regions that rely more on business unit
registers.

    The survey also indicates that corporate boards
recognize the criticality of risk management and are
engaged in the review of risk issues.  Respondents reported
identifying and understanding their risks is a top priority
and many planned to take a more enterprise-wide approach to
risk within the next two years. "By taking a more
integrated, systematic approach to managing risk,"
Joplin said, "organizations can begin to actively
start turning risk into opportunity."

    Aon's Global Risk Management Survey 2007 was conducted
in late 2006 and early 2007 by Aon Global Risk Consulting,
and is based on responses from 320 organizations in 29
countries. The web-based survey, aimed at risk managers,
CFOs, treasurers and others responsible for risk, addressed
both qualitative and quantitative risk issues. Insight is
provided by region, revenue and industry.

    About Aon

    Aon Corporation ( http://www.aon.com ) is a leading
provider of risk management services, insurance and
reinsurance brokerage, human capital and management
consulting, and specialty insurance underwriting. There are
43,000 employees working in Aon's 500 offices in more than
120 countries. Backed by broad resources, industry
knowledge and technical expertise, Aon professionals help a
wide range of clients develop effective risk management and
workforce productivity solutions. 

    This press release contains certain statements related
to future results, or states our intentions, beliefs and
expectations or predictions for the future which are
forward-looking statements as that term is defined in the
Private Securities Litigation Reform Act of 1995. These
forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ
materially from either historical or anticipated results
depending on a variety of factors. Potential factors that
could impact results include: general economic conditions
in different countries in which we do business around the
world, changes in global equity and fixed income markets
that could affect the return on invested assets,
fluctuations in exchange and interest rates that could
influence revenue and expense, rating agency actions that
could affect our ability to borrow funds, funding of our
various pension plans, changes in the competitive
environment, our ability to implement restructuring
initiatives and other initiatives intended to yield cost
savings, our ability to execute the stock repurchase
program, our ability to obtain regulatory or legislative
changes to permit continuous sales of our supplemental
Medicare health product, changes in commercial property and
casualty markets and commercial premium rates that could
impact revenues, changes in revenues and earnings due to
the elimination of contingent commissions, other
uncertainties surrounding a new compensation model, the
impact of investigations brought by state attorneys
general, state insurance regulators, federal prosecutors,
and federal regulators, the impact of class actions and
individual lawsuits including client class actions,
securities class actions, derivative actions, ERISA class
actions, the impact of the analysis of practices relating
to stock options, the cost of resolution of other
contingent liabilities and loss contingencies, and the
difference in ultimate paid claims in our underwriting
companies from actuarial estimates. Further information
concerning the Company and its business, including factors
that potentially could materially affect the Company's
financial results, is contained in the Company's filings
with the Securities and Exchange Commission.


    For more information, please contact:

     Al Orendorff
     Aon Corporation
     Tel:   [phone]
     Email: [e-mail] 
     Web:   http://www.aon.com/newsroom