Survey findings
1. Scenario analysis and stress testing
This section summarises survey results on how organisations anticipate uncertainty: the extent to which they use forward-looking scenario analysis and stress testing; how consistently those insights are embedded in strategic and financial decisions; whether risk appetite informs interpretation and action; and which horizon‑scanning practices are used to identify emerging trends and risks. As in all following sections, findings are presented in aggregate and segmented by listed versus non‑listed status, company size, and sector.
Key takeaway:
Scenario analysis and stress testing support strategy, but further risk management integration may prove beneficial to companies’ decision-making.
According to our survey, more than 50% of respondents proactively embed scenario analysis in shaping their strategic plans, while nearly 33% deploy it selectively and on demand to address specific emerging topics. Regarding stress testing, 43% of organisations say they integrate it into both strategic and financial planning, while 36% apply it mainly to financial risks. 41% of respondents say they use scenario and stress‑test outputs to support cost‑benefit assessments in decisions such as capital allocation, budgeting, and strategic initiatives, while 48% report using the outputs mainly in a qualitative way.
Only around one-third of respondents say they link scenario and stress‑testing findings to risk appetite thresholds to confirm or adjust strategic decisions. This raises questions about how fully risk management is integrated into strategy, which for many organisations may still run in parallel rather than as a converging, joined-up process.
Clear differences emerge between listed and non‑listed companies, with listed firms reporting higher maturity across these dimensions. They are more likely to incorporate scenario analysis into decision-making in a structured way (53% versus 32%) and to link it to risk appetite thresholds (54% versus 24%).
To what extent does your organisation conduct forward-looking scenario analysis?
In the strategic plan definition process
On an ad-hoc basis for selected topics
Following the occurrence of an external shock
No forward-looking scenario analysis
Source: Marsh
To what extent does your organisation run stress tests on variables that materially affect financial performance?
A structured quantitative approach integrated within financial and strategic planning processes is in place
Only with respect to financial risks
Only a qualitative basis
No stress testing
Source: Marsh
Only around one-third of respondents say they link scenario and stress-testing findings to risk appetite thresholds to confirm or adjust strategic decisions.
A similar pattern appears by company size and revenue. Organisations with more than €5 billion in revenue report more mature practices for linking scenario analysis and stress testing to risk appetite, using either quantitative or qualitative thresholds (50% versus 34% overall). By contrast, firms in the €1 billion–€5 billion range fall below average (20%), while those in the €500 million–€1 billion band are above average (42.3%). Such an apparent anomaly is a consequence solely of the sample composition.
Company size plays a role, but the clearest driver of integration between strategy and risk management appears to be the governance requirements that apply to listed companies. Even so, there is still progress to be made in moving from compliance-led practices to integration that genuinely strengthens decision-making.
Are scenario and stress‑test outputs embedded in strategic and financial decision processes?
Yes, in a structured way through quantitative and qualitative analysis to provide cost-benefit analysis inputs
Yes, but only in a qualitative manner
Yes, but only qualitatively on an unstructured ad-hoc basis
No
Source: Marsh
Does your organisation use its defined risk appetite or limits to interpret and act on scenario/stress results?
Are scenario and stress‑test outputs embedded in strategic and financial decision processes?
Yes, but only in qualitative manner to modify/confirm strategic priorities
Yes, only on certain risks
No
Source: Marsh
Sector insights indicate greater maturity among financial services respondents, followed by energy and utilities, particularly in the use of scenario analysis and stress testing. Financial services tend to score higher because scenario analysis and stress testing are strongly driven by regulation and embedded in routine risk and capital management. Energy and utilities often follow because their long-lived assets and large, irreversible capital expenditure require longer-term planning and resilience testing across multiple future pathways.
To deepen their understanding of emerging risks, organisations benefit from extending their time horizons. Across all categories, respondents rely mainly on external industry reports, market research, regulatory and policy monitoring, and internal workshops, while automated trend monitoring remains relatively uncommon. The opportunities enabled by today’s technology have not yet been fully exploited.
Overall, the survey indicates that integration between strategy and risk management remains incomplete. Scenarios and stress tests are used but are not consistently embedded in decisions or linked to risk appetite, so the two processes often still run in parallel. Integration is stronger among listed companies — where governance requirements appear to be the key driver — than among non-listed peers, and it generally increases with size, with the largest organisations showing more mature practices. Emerging-risk identification still relies largely on traditional horizon scanning. At the same time, limited use of automated trend monitoring suggests that technology is not yet fully leveraged to strengthen early warning and long-term resilience.