Regulatory risk ranks as the top threat to business performance, according to a new report by Ernst & Young.
Executives rank regulation and compliance as the top business risks, according to the annual report, but other risks, such as those related to talent management and emerging markets, also strongly concern global executives.
Ernst & Young asked more than 70 leading industry executives and analysts, across 14 industrial sectors worldwide, to identify and rank the top business risks for each sector over the next 12 months. They provided input on the areas they see as the new generation of critical business risks in years to come.
The business risks cited in this years report varied dramatically across sectors, regions and companies. Regulation and compliance regained the top spot across the majority of sectors, prompted by a general uncertainty in the marketplace driven by regulatory reform. Limited access to credit and the threat of continuing weak economic performance in certain regions of the world remain high on the list of potential concerns, ranking second and third, respectively.
Within our report, the majority of the risks identified fall into four distinct quadrants: financial, compliance, strategic and operational risks, said Ernst & Young LLP global risk leader Gerry Dixon. This highlights the importance of taking a broad, holistic view of risk issues, then focusing on the risks that matter most to your business those that are present today and others just on the horizon.
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