Deal with Resilience and the Workforce are Key to Addressing Enterprise Leaders’ Prime Danger Considerations Over the Subsequent Decade, Protiviti-NC State International Survey Finds
A global survey of business executives shows that pandemic-related risks are currently paramount, while technological disruptions and the future of work are cause for concern for the next decade
MENLO PARK, CALIFORNIA, February 3, 2021 / PRNewswire / – C-Suite board members and executives around the world are most concerned in 2021 about risks associated with COVID-19-related government policies and regulations, economic conditions that can limit growth, and market conditions that May continue to affect customer demand, according to a new survey by Protiviti and North Carolina State University. In the midst of this short-term headwind, business leaders cite challenges that will ultimately lead to talent when asked about key concerns up to 2030. High-level risks – including the introduction of technologies that require new or improved skills, rapid innovations that threaten business models, and the reshaping of creative strategies – indicate the need to attract and retain top talent and into the training and development of a workforce to invest in order to ensure agility and flexibility resilience in the future.
The annual survey entitled “Executive Perspectives on Top Risks for 2021 and 2030” was conducted this year by the global consulting firm Protiviti and North Carolina State University The Enterprise Risk Management (ERM) initiative of the Poole College of Management. In its ninth year, the survey was conducted following the November 3rd US elections to reduce the impact an uncertain outcome could potentially have on poll results. The study interviewed over 1,000 (1,081) C-suite board members and executives from organizations in various industries and in all regions of the world.
The top 10 risks for 2021
Respondents were asked to rate 36 macro, strategic and operational risks, including new risks that emerged this year related to the COVID-19 pandemic and social justice. The 10 most important risks for 2021 are:
- Policies and regulations related to pandemics have an impact on business development
- Economic conditions limit growth opportunities
- Pandemic market conditions reduce customer demand
- The adoption of digital technologies requires new skills or significant efforts to qualify / re-qualify existing employees
- Data protection / identity management and information security
- Cyber threats
- Effects of regulatory changes and controls on operational resilience, products and services
- Successor challenges, ability to attract and retain top talent
- Resistance to changes in the operation and business model
- Ability to compete with “born digital” and other competitors
“2020 has shown more than ever that companies can no longer afford a reactive approach to risk management. The pandemic risk has been looming for a long time – it was about when, not when,” he said Jim DeLoach, a Protiviti executive director and co-author of the report. “Executives need to be vigilant as they look for problems as they arise and create actionable plans to adapt their strategies and business models. At the same time, they need to authentically nurture the trust-based, innovative culture and organizational resilience required to successfully manage disruptive change. Digitally mature Companies with an agile workforce were ready when COVID-19 hit and are best positioned to continue to navigate the rapid accelerating wave of digital change through the pandemic and beyond. “
In line with the results of the survey over the past few years, data security and cyber threats are again among the top 10 risks for both 2021 and 2030. The ever-evolving cyber and privacy risks underscore the need for a secure operating environment where agile employees can regularly update the technology and skills in their arsenal to stay competitive.
“If there is a risk that all companies in different industries and regions will have to continue to focus on this, it is cybersecurity and privacy,” he said Patrick Scott, Executive Vice President, Industry Programs, Protiviti. “While the areas businesses must address can change as they change their business models and increase resilience to face the future with confidence, cybersecurity and privacy threats remain constant and should be high on the list. These Threats have been a major risk for a long time, and they’re not going away. “
The top risks for 2030
New for this year’s survey: respondents also rated the expected impact of the same 36 risks on their organizations in 2030. The risk landscape for 2030 shows a very different picture, according to respondents who identified the following as the top 10 risks for 2030:
- The adoption of digital technologies may require new skills or significant efforts to qualify / re-qualify existing employees
- Effects of regulatory changes and controls on operational resilience, products and services
- The rapid pace of disruptive innovations exceeds our competitiveness
- Successor challenges, ability to attract and retain top talent
- Data protection / identity management and information security
- Replacement products or services are created that influence our business model
- Maintaining customer loyalty and loyalty becomes more difficult as customer preferences and demographic changes change
- Ability to compete with “born digital” and other competitors
- Inability to use data analytics and “big data” to obtain market intelligence and increase productivity and efficiency
- Cyber threats
Looking at the ten-year risk horizon, executives are concerned about the future of work, especially when it comes to their company’s ability to adapt to new digital technologies and keep up with the breakneck pace of disruptive innovation. According to the survey, a company’s ability to qualify and retrain employees, and attract and retain top talent, will be of paramount importance to its risk management strategy over the next decade.
DR. Mark Beasley, Professor of Enterprise Risk Management and Director of NC State The ERM initiative and co-author of the report said, “After a year of unprecedented adoption of digital tools in various industries around the world, companies are under increasing pressure to focus on new skills, processes, products and services to meet changing customer preferences Protect their brand value and competitiveness in an increasingly complex and automated world. One of the most important lessons executives must learn from 2020 is that they must prepare for a disruptive future by positioning their organizations in such a way that they adapt and evolve at the speed of change. “”
The study’s report also includes a call to action that provides executives and directors with diagnostic questions to consider when evaluating risk assessment and risk management processes.
Resources available
The report “Executive Perspectives on Top Risks for 2021 and 2030” by Protiviti and North Carolina State University provides information on the respondents, broken down by type of company, size, industry, geographic region and role of the respondents. The report as well as an infographic and a podcast on the survey results can be downloaded free of charge here. Protiviti is hosting a one hour webinar with a panel from Beasley, Bozzella, DeLoach, Scott and Manisha Shah, a Protiviti executive director and head of privacy practice, to discuss the implications of the survey results on February 24, 2021 at the 11:00 a.m. PST. Participation is free if you register here.
About Protiviti
Protiviti (www.protiviti.com) is a global consulting firm that delivers in-depth expertise, objective insight, a bespoke approach, and unprecedented collaboration to help executives look to the future with confidence. Protiviti and its independent and locally owned member firms provide advice and managed solutions in finance, technology, operations, data, analytics, governance, risk and internal audit to clients through its network of more than 85 offices in over 25 countries.
Protiviti was named to the 2020 Fortune 100 Best Companies to Work For® list and has served more than 60 percent of the Fortune 1000 and 35 percent of the Fortune Global 500 companies. The company also works with smaller, growing companies, including those looking to go public, as well as government agencies. Protiviti is a wholly owned subsidiary of Robert Half (NYSE: RHI). Robert Half was founded in 1948 and is a member of the S&P 500 index.
About the ERM initiative
The ERM initiative (www.erm.ncsu.edu) in the Poole College of Management at North Carolina State University provides thought leaders to help executives and board members gain control over enterprise-wide risk as they develop and execute growth strategies. The ERM Initiative website features over 600 articles, thought papers and best practice documents that leaders can use to tackle today’s uncertainties for tomorrow’s strategic success.
Protiviti is not licensed or registered as an accounting firm and does not provide opinions on financial statements or provide verification services.
Editor’s note: Photos and infographics available upon request.
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