How SA compares globally with attitude to risk
More businesses across the globe are open to risk, with nearly half of business decision makers describing themselves as risk-seekers. This is according to the Sage Business Index, an annual global measure of confidence across small and medium sized companies.
The research which surveyed close to 14,000 small and medium sized businesses in 18 countries in Africa, Europe and Australia, looked at how decision-makers approach risk.
The willingness to take risk is an integral part of running a business. Business leaders are faced with uncertainty daily with almost every business decision having some element of risk-taking.
According to the report, a global shift in confidence levels is behind why businesses are more open to risk. Confidence levels are generally high with business owners more optimistic about their prospects, and majority of businesses anticipating turnover to grow and an increase in the number of people they will employ.
The numbers show that globally, nearly half (49%) of business decision makers described themselves as risk-seekers, up 2% from last year. However, nearly a third of businesses (35%) said that they have become more risk averse over the last seven years.
Business attitudes to risk in the country are changing. More business decision makers (50%) describe themselves as risk-takers, compared with 48% in 2013. Around 40% say that they have become more risk averse over the last seven years.
“It is natural for companies to be cautious given the economic challenges South Africa faces,” says Ivan Epstein, CEO of Sage AAMEA (Australia, Asia, Middle East and Africa). “So it’s encouraging that many still have the appetite for calculated risk for the sake of growing their businesses.”
The report showed that businesses in the region have also become more open to risk with nearly two-thirds (63%) of decision makers – the highest globally – describing themselves as risk-seekers, up from 14% last year.
Australians, according to the survey, are more confident than many other countries when it comes to their national economy scoring above the global average.
Over half of business decision makers (53%) described themselves as risk-seekers, 4% above the global average of 49%.
Brazilian businesses are among the most optimistic in the world when it comes to their own prospects.
Over three fifths of business decision makers(61%) described themselves as risk-takers, compared with 56% in 2013. Nearly a third (32%) said they have become more risk averse over the last seven years.
According to the report, Germany remains one of the most risk averse countries with only Portuguese and Austrian businesses more risk averse. Just 43% describe themselves as risk-takers, which is down 2% from the same time last year.
Nearly half of business decision makers (44%) describe themselves as risk seekers, up 2% from last year. However, the UK still ranks as one of the more risk averse countries, trailing risk seekers in the US (54%) and Brazil (61%).