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Poole College of Management
Jenkins Master of Management
Risk and Analytics

New Report: Economy, Inflation Outrank Talent and Technology as Primary Risk for Global Business Leaders in 2024 

December 13, 2023
chief risk officer

Media Contacts:

Prosek Partners
Pro-protiviti@prosek.com 

Suzanne Stanard
NC State University
sjstanar@ncsu.edu

Economic pressures and persistent inflation have unseated the war for talent as the top near-term risk facing business leaders around the world, according to a new survey from Protiviti and the NC State University Poole College of Management’s Enterprise Risk Management (ERM) Initiative. The survey measures the most pressing business risks over the next year as well as the next decade. Beyond the economy and talent market, business leaders are also increasingly concerned about cyber threats in both the near and long-term, with this risk ranking as the top concern of respondents over the next decade.

The 12th annual survey, “Executive Perspectives on Top Risks for 2024 and a Decade Later,” was conducted by global consulting firm Protiviti and the ERM. The study surveyed more than 1,100 board members and C-suite executives from organizations worldwide in a variety of industries, asking them to rate 36 macroeconomic, strategic and operational risks on a sliding 1-10 scale across one-year (2024) and one-decade (2034) time horizons.

The Top Risks for 2024

There was significant turnover in the top risks over the coming year, with six falling out of this year’s top ten list for 2024 versus last year, including the top near-term risk. Economic conditions and inflationary pressures emerged as the top near-term risk for 2024. Continuing a trend highlighted by the last two years’ surveys, finding and retaining talent while managing culture and workplace evolution remained a major concern. Of the 36 macroeconomic, strategic and operational risks assessed in the survey, the top five risks identified for 2024 are: 

  1. Economic conditions, including inflationary pressures
  2. Ability to attract, develop and retain top talent, manage shifts in labor expectations, and address succession challenges
  3. Cyber threats
  4. Third-party risks
  5. Heightened regulatory changes and scrutiny 

The Top Risks for 2034

Survey respondents also rated the expected impact of the same 36 risks for a decade out, into 2034, assessing how the risk landscape might shift over the coming decade. The top five risks identified for 2034 are: 

  1. Cyber threats
  2. Ability to attract, develop and retain top talent, manage shifts in labor expectations, and address succession challenges 
  3. Adoption of digital technologies requiring new skills in short supply
  4. Rapid speed of disruptive innovations enabled by new and emerging technologies and/or other market forces
  5. Heightened regulatory changes and scrutiny

“The economy, inflation and cybersecurity clearly loom large on the executive risk agenda, but the best leaders realize that all these risks are intertwined and need to be addressed as a whole, not in parts,” said Matt Moore, global leader, Risk and Compliance, at Protiviti. “C-suites and boards need to be nimble to address concerns on a variety of strategic and operational fronts and keep pace with the speed of change. Leaders are expected to manage multiple external risks effectively without disruptions to operations, productivity or profitability.”

Although not recorded as a top risk, geopolitical events had a significant ripple effect across the risk landscape. Before the events that took place in the Middle East on Oct. 7, 2023, the survey found that no risk issues were rated at the “Significant Impact” level for 2024, but in the responses gathered following the attacks, many risks increased and four risk issues were rated at the “Significant Impact” level.

“It is still an open question of whether or not recent economic developments and central bank policies will lead to a soft landing or a recession that would force organizations to make dramatic changes,” said Carol Beaumier, a senior managing director in Protiviti’s Risk and Compliance solution and leader of the firm’s global thought leadership program. “Alongside this uncertain economic picture has come regulatory change in wide-ranging and pervasive areas, meaning that business leaders need to plan for a range of outcomes as to how these changes will affect their operations.”

Looking out a decade, cybersecurity is the most pressing risk issue, with the risk rating for cyber threats increasing by more than 11% over last year’s survey — by far the largest risk rating increase noted in the survey’s history.

“While the economy is the top-ranked risk for the coming year, cyber threats jumped to the top of the list when leaders assessed both near- and long-term outlooks, after not being a top-five risk at all last year. This jump reflects the growing recognition of the complex cyber risk landscape that is impacted by the exponential curve of technological advances and how seriously leaders are taking these threats,” said Mark Beasley, Poole College’s Alan T. Dickson Distinguished Professor of Accounting and director of the Enterprise Risk Management Initiative, who co-authored the report with professors Bruce Branson and Don Pagach.

“Over the next decade, technologies such as artificial intelligence, cloud and the anticipated emergence of quantum computing will change how organizations secure their data, raising significant security-related questions,” said Sameer Ansari, Protiviti global Security & Privacy lead. “To adapt quickly to new technologies, many organizations are increasing reliance on outsourcing and co-sourcing arrangements to achieve operational and go-to-market objectives. Additional risks arise as organizations must ensure their third-party partners, are complying with current laws and regulations to ensure their data and their customers’ data is secure.”

How Companies Can Take Action

No matter the time horizon, this year’s survey results highlight important steps executives should take to protect their companies against risk and maximize their chances of future success. The report from Protiviti and NC State’s ERM Initiative outlines the next steps that executives should take to address key areas of concern, including: 

  1. Navigating an uncertain economic environment
  2. The cyber issues executives should be thinking about
  3. Forging ahead with artificial intelligence capabilities 
  4. Embracing new talent strategies
  5. Understanding and managing the geopolitical risk landscape
Read the full report

Resources Available 

The “Executive Perspectives on Top Risks for 2024 and a Decade Later” report from Protiviti and NC State’s ERM Initiative provides detailed results and analysis broken out by company type, size, industry, geographic region and respondent role. The report, along with a global webinar series, an infographic and a podcast about the survey results, is available for complimentary download here. Protiviti’s global webinar series kicks off with a one-hour panel discussion hosted by Protiviti’s Matthew Moore and featuring executives from Protiviti, MacroPolicy Perspectives and Prudential Financial to discuss the implications of the survey’s findings on Jan. 11, 2024 at 11 p.m. ET. Attendance is free with registration here.

About Protiviti

Protiviti is a global consulting firm that delivers deep expertise, objective insights, a tailored approach and unparalleled collaboration to help leaders confidently face the future. Protiviti and our independent and locally owned Member Firms provide clients with consulting and managed solutions in finance, technology, operations, data, analytics, digital, legal, HR, governance, risk and internal audit through our network of more than 85 offices in over 25 countries.

Named to the 2023 Fortune 100 Best Companies to Work For® list, Protiviti has served more than 80% of Fortune 100 and nearly 80% of Fortune 500 companies. The firm also works with smaller, growing companies, including those looking to go public, as well as with government agencies. Protiviti is a wholly owned subsidiary of Robert Half Inc. (NYSE: RHI). Founded in 1948, Robert Half is a member of the S&P 500 index.

About the Enterprise Risk Management (ERM) Initiative

The Enterprise Risk Management (ERM) Initiative in the Poole College of Management at North Carolina State University provides thought leadership about ERM practices and their integration with strategy and corporate governance. Faculty in the ERM Initiative frequently work with boards of directors and senior management teams helping them link ERM to strategy and governance, host executive workshops and educational training sessions, and issue research and thought papers on practical approaches to implementing more effective risk oversight techniques.

This post was originally published in Poole Thought Leadership.