Health and safety tops cyber threats as main concern for global directors and officers

Health and safety tops cyber threats as main concern for global directors and officers | Insurance Business Asia

Professionals Risks

Health and safety tops cyber threats as main concern for global directors and officers

Report unveils emerging risks

Professionals Risks

By
Roxanne Libatique

Health and safety have emerged as the main concern for directors and officers globally, according to the 2024 Global Directors’ and Officers’ Survey conducted by WTW alongside Clyde & Co.

The study examined the array of challenges that directors and officers face across key regions, including the UK, Europe, Asia, Australasia, Latin America, North America, Africa, and the Middle East.

It found that a significant 84% of participants underscored health and safety as a primary issue, narrowly edging out cyber threats, which was a close second with a 79% concern rate.

Shift in perception of risks for directors and officers

The findings showed a notable shift in the perception of risks, with data loss now ranking third globally, a departure from its previously higher ranking.

Region-specific insights revealed that in Asia, data loss is still regarded as the third highest risk, whereas in Australasia, it has slipped to fourth. A striking observation from this year’s survey is the diminishing concern over the risk of organisations becoming targets of crime, which has dropped out of the top seven risks for the first time since 2019.

Emerging risks for directors and officers

The survey also identified emerging risks gaining prominence, such as failures in systems and controls and breaches of sanctions. These new concerns are reflective of the current geopolitical climate and the increasingly intricate nature of corporate governance.

Despite not ranking among the top seven globally, the issue of climate change remained a significant concern in regions like Asia, Australasia, and the Middle East. This indicates a strong regional focus on environmental issues, especially in the context of mandatory climate reporting initiatives in markets such as Singapore and Australia.

Furthermore, the survey pointed to a trend towards the exploration and adoption of alternative risk transfer strategies, including captives, suggesting a strategic approach to navigating D&O risk amid changing market dynamics.

Simon Weaver, head of Asia Pacific and head of corporate risk and broking for Asia Pacific at WTW, highlighted the rise of health and safety as the paramount concern in the APAC region.

“Health and Safety is the new top risk facing directors in APAC, taking the top position from cyberattacks as last year’s survey leader in the region. The new #1 echoes the results of other regions’ (except Great Britain) similarly noting Health and Safety as the foremost risk facing them in 2024. This reiterates the unique and complex issues facing today’s directors which go beyond simply financial obligations of shareholder return,” he said.

James Cooper, partner and global chair of insurance practice at Clyde & Co, commented on the dynamic risk landscape.

“The report underscores the dynamic and complex nature of the risk landscape currently facing directors. What we have seen is that there is a pressing need for better education on D&O insurance and indemnification practices to ensure directors and officers are comprehensively protected. By leveraging the insights and recommendations from this report, organisations can better navigate these challenges, enhancing their resilience and strategic response to risks,” he said.

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