A global survey by Protiviti and NC State University’s ERIM initiative reveals the top 10 operational risks in 2020.
This year’s respondent group comprises of 1,063 board members and C-suite executives from all major regions of the world, including Asia, on their perspective of the major risks businesses are likely to face this year, said Protiviti.
Board members and C-suite executives worldwide perceive a slightly less risky business environment in 2020 compared to 2019, with only two of the top 10 risks rated higher in 2020 than they were in 2019, according to survey results.
Though there is a slight reduction in risk concerns this year, it is still much higher than two years ago, Protiviti pointed out.
While the top risk issue globally in 2020 is regulatory change and scrutiny, the number 2 risk, economic conditions, is notable in that it was not among the top 10 risks in 2019, the firm noted.
A new risk added in this year’s survey made it to top 10 (tenth overall), which is the ability to attract, retain and re-skill talent needed for organisations to adopt digital technologies such as AI, robotics, natural language processing, among others, Protiviti observed.
“Other operational concerns dominate the top 10 global risk issues, including succession challenges and resistance to change—this suggests on the surface that respondents continue to be focus on operational issues to a greater extent than strategic or macroeconomic risks,” said Adam Johnston, country leader and managing director at Protiviti.
In addition, the global epidemic such as the recent outbreak of Coronavirus will have devastating impacts, in both immediate and long-term aspects, to the economic conditions, which ranks number two in the top 10 risks in the survey, he noted.
The ever-changing risk landscape and overall perceived magnitude and severity of risks should prompt boards and senior executives to closely scrutinise the approach they use to keep an eye on emerging risks, Protiviti said.