Just when you think you have your risk management under control, a new risk emerges or an old one evolves. To avoid unexpected losses, watch out for these emerging manufacturing exposures.

Forever Chemical Bans Could Be Coming

PFAS, known as forever chemicals, have been showing up everywhere and prompting safety concerns. Manufacturers that use PFAS could face bans as well as lawsuits.

The U.S. Geological Survey says at least 45% of the country’s tap water contains at least one type of PFAS. Forever chemicals have also been detected in unexpected products. For example, research published in Chemosphere says forever chemicals are present in paper and other plant-based straws.

The use of forever chemicals is already leading to lawsuits. However, litigation may be heating up. 3M recently reached a $12.5 billion settlement with public water systems, but Top Class Actions says 22 states are urging the judge to reject the settlement. According to Time Magazine, manufacturers like DuPont and 3M knew about the potential toxicity of forever chemicals as early as the 1960s and were aware of the dangers by 1970, but they kept this quiet.

Bans may be coming. Nature says a European agency is considering restrictions on forever chemicals, whereas the Washington Post says U.S. states have been moving to ban PFAS.

Manufacturers Are Being Called Out for Greenwashing

ClientEarth defines greenwashing as a company using “advertising and public messaging to appear more climate friendly and environmentally sustainable than it really is.” Greenwashing can be tempting because 66% of consumers are willing to pay more for environmentally-friendly products.

Engineering and Technology says regulators and organizations are calling out oil, chemical, and manufacturing companies that greenwash their plastic production. Some companies have already faced legal and regulatory action. Truth in Advertising has a list of companies that have been accused on greenwashing, including a recent high-profile class action lawsuit against Delta Air Lines.

Cyber Risks Are Escalating for Manufacturers

Cyberattacks aren’t a new threat in the manufacturing sector. In fact, the manufacturing sector is a favorite target of hackers, likely because manufacturers are sensitive to downtime. An analysis from Dragos found that 70% of all alleged ransomware attacks impacted manufacturers.

However, according to Automotive World, the risks are increasing due to increased digitalization and more complex supply chains. A manufacturer doesn’t even have to suffer an attack directly to be impacted – if any of its suppliers are impacted, business operations may be threatened.

Manufacturers should also watch out for business email compromise schemes seeking to divert shipments of goods, materials, or supplies. According to the FBI, one recent scheme succeeded in stealing large shipments of food products and ingredients.

Heat Waves Make Staying Cool Harder

According to Axios, record temperatures have hit the U.S., Europe, and Asia. Many records were broken, including the most consecutive days with temperatures of at least 110°F in Phoenix.

Heat-related illnesses are a serious threat. Although these risks may be most associated with outdoor workers (such as construction and agricultural workers), manufacturers may also be vulnerable. The equipment used in manufacturing processes can cause indoor temperatures to soar. According to Manufacturing Dive, manufacturing with hot local heat sources can lead to heat-related illnesses for indoor workers. Bringing temperatures down with AC may be harder periods of extreme heat, which also puts equipment at risk of overheating.

The Supply Chain Continues to Evolve

The COVID-19 pandemic triggered widespread supply chain problems. Supply Chain Brains warns that war in Ukraine and tensions between the U.S and China could lead to continued supply chain issues. According to Insurance Business, the semiconductor supply chain is especially vulnerable and could impact the global electronics sector.

In the face of ongoing disruption, many manufacturers are rethinking their supply chains. EY calls this the Great Supply Chain reset and says companies are making their supply chains more cost efficient, resilient, and sustainable. For example, 53% of companies surveyed said they are considering nearshoring – i.e., moving business operations to a nearby area.

Are You Managing Your Risks?

Risk management never ends. RiskPoint can provide you with assistance in managing emerging manufacturing exposures. We offer comprehensive insurance solutions designed for the manufacturing sector. Learn more.