The UN Secretary-General was speaking at the launch of a ground-breaking new report from the UN Office for Disaster Risk Reduction (UNISDR), which is built on important new data sets including reviews of national disaster loss data bases in 40 countries, survey responses from 1,300 SMEs in disaster-prone locations in the Americas, and a review of risk management in 14 major corporations including ABB, ARUP, BG Group, Citigroup, General Electric, HCC Group, HIRCO Group, Hitachi Group, InterContinental Hotels Group, Nestlé, NTT East Corporation, Roche, Shapoorhi Pallonji & Co. Ltd., and Walmart.

The “UNISDR 2013 Global Assessment Report on Disaster Risk Reduction (GAR13): Creating Shared Value – the Business Case for Disaster Risk Reduction” highlights how the transformation of the global economy over the last 40 years has led to rapid increases in disaster risk in low, medium and high income countries.

A new global risk model developed by UNISDR and partners, demonstrates that annual average losses from just earthquakes and cyclonic winds can be expected to be in the range of $ 180 billion this century. The report makes a strong case that globalization, the search for lower costs, higher productivity, and just-in-time delivery are driving business into hazard-prone locations with little or no consideration of the consequences on global supply chains.

UNISDR Chief Margareta Wahlström, speaking also at the launch, said, “In a world of on-going population growth, rapid urbanization, climate change and an approach to investment that continually discounts disaster risk, this increased potential for future losses is of major concern.”

“In the wake of the global financial crisis, disaster risk stands as a new multi-trillion dollar class of toxic assets of unrealized liabilities. The catastrophic economic losses from the Japan earthquake/tsunami, floods in Thailand and the destructive Superstorm Sandy show clearly the extent of what is at stake.”

GAR2013 analyses three key global investment sectors – urban development, agribusiness, and coastal tourism – and reveals that prevailing business models in each sector continue to drive disaster risk.

The UNISDR teamed with PwC to conduct some of the research and analysis for the report.