Cybersecurity risks. Uncertainties in political regimes in certain parts of the world. Technological innovation. Expanding regulation and oversight. Falling oil prices. Geopolitical conflicts. These and a host of other significant risk drivers are all contributing to the risk dialogue in boardrooms and executive suites.
Expectations of key stakeholders regarding the need for greater transparency about the nature and magnitude of risks undertaken in executing an organization’s corporate strategy continue to be high. Pressures from boards, volatile markets, intense competition, demanding regulatory requirements, fear of catastrophic events and other dynamic forces are leading to increasing calls for management to design and implement effective risk management capabilities to identify and assess the organization’s key risk exposures, with the intent of reducing them to an acceptable level.
This report from Protiviti and North Carolina State University’s ERM Initiative contains results from the third annual survey of directors and executives to obtain their views on the extent to which a broad collection of risks are likely to affect their organizations over the next 12 months. Among this year’s key findings:
- The global business environment in 2015 is perceived to be somewhat less risky for organizations than it was in the last two years.
- Most organizations are more likely to invest additional resources towards risk management in 2015 compared to the past two years.
- Regulatory change and heightened regulatory scrutiny is the top overall risk for the third consecutive year.
- There are concerns about cyberthreats disrupting core operations.
- Economic conditions are again a key risk area for organizations.
- There is greater focus on succession challenges and the ability to attract and retain talent.