The perceptions of business risks, from supporting staff to ESG regulation and economic uncertainty, are changing the global business risk landscape according to a new report by specialist insurer Beazley.
The new report Spotlight on: Business Risks 2023 published in November 2023 has revealed that despite a challenging macro environment, business leaders are increasingly looking inwards at challenges related to managing staff and employees despite the growing threat of external risks facing global boardrooms.
A press release issued by Beazley said the employer risk doubles with 22% of global business leaders saying this risk is the number one threat facing their organization this year, doubling from 11% in 2021. Yet, 1 in 4 (27%) boardrooms feel ill-equipped and unprepared to deal with it. As ESG regulation mounts, 1 in 4 (26%) global business executives feel unprepared to anticipate and respond to ESG risks.
As the risks become greater for businesses, the research shows that almost half (42%) of global business leaders believe they will be operating in a high-risk environment in six months’ time, up from 31% this year.
The report reveals that perceptions around business and executive risks, from employee risk to reputation management to ESG regulation, are changing the risk landscape for business leaders and over a third (35%) of global executives now plan to explore insurance options that include risk and crisis management as business challenges mount.
The data, based upon a survey of 2,000 global business leaders by research company Opinion Matters, reveals that among the challenges organizations are grappling with, the growth of the #MeToo movement and a welcome increase in staff reporting workplace issues has led to a rise in allegations being made, and these factors appear to be drivers of concern.
Additionally, a worsening of staff mental health post-pandemic has placed a greater emphasis on workplace support initiatives. Worryingly, 1 in 4 (27%) executives surveyed said they feel ill-equipped and unprepared to deal with today’s employer risks.
Business leaders surveyed believe managing their reputations will become increasingly tough in the coming months, with 17% ranking this as their top risk today, rising to 19% in 2024.
Beazley group head of specialty risks Bethany Greenwood said, “Global business leaders are dealing with a challenging array of new and persistent risks that threaten their business models. It might seem counter-intuitive that executives are increasingly looking inward at their workforce and workplace to meet today’s challenges.”
The research shows that failure to comply with new ESG-related requirements, including related legislation or reporting requirements, is of greater concern for business executives in the US and Canada than in the UK and Singapore.