In many organizations, physical security is still seen as an unavoidable “cost center”-a set of expenses to be contained, rather than a strategic element to be invested in with vision.
This mindset can work as long as everything goes well. But when a critical event happens – theft, sabotage, intrusion, accident – the cost of not having integrated security into business strategy emerges in full force.
And it is not just about immediate costs of restoration or repair. The real losses are about business continuity, reputation, stakeholder trust, and enterprise value.
Recent studies show that neglecting physical safety can lead to:
- A loss of between 2% and 5% of annual revenueinthe event of accidents (Allianz Risk Barometer)
- Losses exceeding 10 percent of enterprise valuewithoutadequate business continuity plans (Business Continuity Institute)
- Increased insurance costs of up to 30%andloss of attractiveness in financial markets (FM Global Resilience Index)
Let us look in detail at the real impact of this underestimation.
Direct costs: the immediate impact of a critical event
When an event compromises a company’s physical security, the first costs are immediate and measurable:
- Structural damage: repairs, replacements, remediation
- Operational shutdowns: freezing of activities, contractual penalties
- Theft and material losses: with damage also on supply chains
- Legal and expert witness fees: litigation, compensation, emergency compliance costs
- Response and investigation costs: strengthening surveillance, post-accident audits
Each day of inactivity can cost between 100,000 and 500,000 euros, depending on the industry and company size (BCI Report).
Indirect costs: the real risk for the company
In addition to the immediate damage, the heaviest consequences occur in the medium to long term:
- Reputational damage: a loss of trust can take years to rebuild
- Loss of competitiveness: exclusion from competitions or strategic clients requiring high safety standards
- Increased regulatory vulnerability: penalties, license revocations, loss of certifications
- Declining internal morale: insecurity among employees and difficulty attracting new talent
- Rising insurance costs: higher premiums, more limited coverage
According to the Ponemon Institute, companies with non-integrated physical security systems incur up to 40 percent more costs in incident management than those with proactive strategies.
The risk of losing enterprise value
A major critical event can compromise:
- The market value (for listed companies)
- The ability to access credit and investment funds.
- The strength of business partnerships
- The stability of the customer base
The FM Global Resilience Index confirms that resilient companies with a solid security and business continuity strategy maintain up to 20 percent more stable market value over the next five years.
Security as a strategic investment
Investing in security means:
- Protecting daily productivity
- Safeguard the reputation and trust of stakeholders
- Improve competitiveness and access to more selective markets
- Reduce hidden costs associated with poorly managed emergencies
Each euro invested in solid security is equivalent to protecting a much larger capital.
Conclusion
Not considering corporate physical security as a strategic lever is not just a risk: it is a real threat to the very survival of the enterprise.
In an increasingly competitive and unpredictable market, physical security must be fully integrated into corporate governance as a pillar of resilience and future growth.
The choice to be made is no longer “whether to invest,” but how risky it is not to do so.
