Cyber risks dominate the top five risks facing directors and officers, according to the latest annual survey by WTW and Clyde & Co.
The Directors’ Liability Survey 2022, which polled directors across the world, found that cyber attacks are perceived as the biggest liability to business leaders this year. Some 65% of respondents said the risk of cyber attack is very significant or extremely significant. Next came data loss on 63%. These were also the top two risks when the survey was carried out last year.
Number three in this year’s risk list is cyber extortion on 59%. It is the first time the survey has asked if cyber extortion is a big risk for directors.
Regulatory risk is fourth in the latest poll at 49% and slips from third place last year. Health and safety/environmental prosecutions complete the top five on 46%, falling one place from the 2021 survey. The top five global risks were the same among respondents in Europe.
ESG risks don’t feature in the survey’s top five but are not far behind. Climate change risk was added to the survey for the first time this year and 38% of respondents believe it is a very or extremely significant risk for directors. Some 36% said the risk of becoming the focus of a social media campaign is a big threat.
Releasing the findings, WTW and Clyde said, “Despite the increased attention on climate change risks following COP26 and recent regulatory changes, it still remains outside the top five risks in any region. However, it has risen to be the number six risk for directors in Great Britain, Asia and Australasia; and when looked at by industry grouping, climate change does make it into the top five for finance and insurance, as well as for energy and utilities.” M