Highly Efficient Supply Chains Expose Global Firms to Cybersecurity Threats
Today’s interconnected global economy has produced exceptionally efficient supply chains, but at a growing cost: cybersecurity vulnerability. According to WTW’s newly released 2025 Global Supply Chain Risk Report, cyber threats are now a central concern in supply chain risk management. Based on replies from 1,000 senior executives across industries, the report, like so many before it, outlines a troubling increase in cyber-related disruptions and underscores the evolving landscape of insurability.
Cybercrime’s Rising Impact
Cybersecurity risk jumped from 5% in 2023 to 16% in 2025, among the top concerns of surveyed businesses. Nearly 56% of respondents now view cybersecurity as the most significant threat over the next two years. This is the highest-rated factor for future supply chain impact, ahead of raw material shortages and regulatory changes.
Cyber attacks are becoming more frequent, complex, and costly. About 25% of surveyed firms now rank cyber threats as a “very high” risk, while over half see them as “moderate” risks. Only 1.8% considered them “low.”
This rise is largely driven by increased digital transformation. As companies digitize operations and expand supplier ecosystems, entry points for cybercriminals multiply.
Business Interruption Insurance
The WTW report also emphasizes the implications for the insurance market. Business interruption – particularly from cyber-related incidents – is among the most challenging exposures to quantify.
Insurers face rising pressure to model these risks more precisely. Many firms now use business interruption insurance, especially contingent policies that kick in when supply chain partners face disruptions. However, widespread cyber attacks that simultaneously impact multiple firms or regions pose aggregation challenges for underwriters.
Hugo Wegbrans of WTW noted that modern supply chain complexity makes it hard to price these risks accurately, saying “The complexity of modern supply chains presents a unique challenge for the insurance industry, where risks must be thoroughly understood and accurately quantified to enable effective diversification and appropriate premium pricing.” He stressed that insurance solutions must adapt quickly to remain competitive and viable.
Data Security and Supplier Risks
Data security emerged as the top contributor to supply chain risk in 2025. Stop now, consider this change, it jumped from 23% in 2023 to 47% in 2025. Companies recognize that digital vulnerabilities, particularly within third-party suppliers, pose major threats to operations.
Only 8% of businesses believe they have complete control over their supply chain risks. This underscores a growing consensus: partnerships and collaborative frameworks are essential to enhance cyber resilience.
Strategic Shifts in Risk Management
Risk management is evolving in response to these cyber concerns. Over 65% of surveyed firms have now integrated cybersecurity risk into their enterprise risk frameworks. A similar proportion have standardized cyber risk classification and communication procedures.
Clear communication with suppliers and internal stakeholders is a growing priority. Around 64% of respondents have established strong communication lines for addressing supplier-related cyber threats.
Most firms are focusing on proactive measures. These include supply chain mapping, risk modeling, and executive oversight to prevent digital blind spots. Yet, significant gaps remain, especially in fully implementing these frameworks across complex, global operations.
Cyber Resilience: The New Competitive Edge
Digital transformation and high-quality data availability are seen as key opportunities in enhancing supply chain resilience. Companies now prioritize these areas to maintain a competitive edge while mitigating cyber risk.
An ounce of prevention time! Businesses are shifting from reactive crisis management to long-term resilience planning. This includes redefining risk appetite, developing internal risk expertise, and involving C-suite leadership.
Methodology in Brief
The survey, conducted in November 2024, included 1,000 executives from companies with revenues exceeding $250 million. Respondents spanned diverse industries and geographies, offering a broader insight into the global supply chain landscape.
For the 5th Grader: The Chain and the Gate
Think of global supply chains as a high-speed train line, built for speed and efficiency. But every station (supplier) has its own ticket booth (cyber gate). If just one gate breaks down or gets hacked, the whole network faces delay or shutdown.
It’s like having the world’s fastest delivery system but using rusty padlocks at every warehouse. That’s what businesses are up against when it comes to cybersecurity in their supply chains.
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