PeopleRisk2024 Investinginyourpeople,protectingyourbusiness 2 Contents PeopleRisk2024:Investinginyourpeople,protectingyourbusiness Aboutthecoverimage Thisimagerepresentsthecomplexworldinwhichwelive,withconcurrentcrises,interactingrisksandintensifyingstakeholderexpectations,aswellastheagilityandresilienceweneedtohavewhenoperatinginafast-changingworld. Thevibrantcolorsrepresenttheoptimismthatcomesfrommanagingpeopleandbusiness-relatedrisksthroughinnovationandcollaboration. p3 p5p5p6p7p8p9 p10p11 p14 p20p25 p26 p29p37p42 p44 p47p55p62 p64 p67p71p77 p78 p81p86p91 p93p96 Investinginyourpeople,protectingyourbusiness AbouttheresearchHowtousethisreportThe25peoplerisks ToprisksforHRandRiskprofessionalsToprisksbyregion Toprisksbyindustry 10imperativesforaddressingpeoplerisksChapter1:Technologicalchangeanddisruption DevelopaworkforcethatfightsbadactorsDon’tdelayonaddressingAIRecommendations Chapter2:Talent,leadershipandworkforcepractices Powertheproductivityofyourpeople TakeownershipforcreatingaresilientorganizationRecommendations Chapter3:Health,well-beingandsafety Designworkforwell-being BecomeacatalystforhealthtransformationRecommendations Chapter4:Governance,complianceandfinancial BepreparedforbenefitscostincreasesGetaheadofemerginggovernancegapsRecommendations Chapter5:Environment,sustainabilityandprotection AddressclimaterisksashealthrisksMinimizebenefitdisparitiesRecommendations Conclusion:KeytakeawaysAppendix PeopleRisk2024:Investinginyourpeople,protectingyourbusiness Investinginyourpeople,protectingyourbusiness HRandRiskprofessionalssitattheapexofabalancingact.Economicchallenges,conflict,energytransition,disruptivetechnologies,talentshortages,wideningcyberrisks,increasingcompliancedemandsandgrowingbenefitscostsallrequirecarefulmitigationusingeffectiveriskframeworksandpeoplemanagementstrategies. 3 However,manyofthosesamefactorsareatthecoreoffuturebusinessinnovation:newskillsandknowledgeopportunities,thepotentialofAI,betterstewardship ofbusinessesandwaystoevolveemployeehealthcareforanewgenerationofworkers. Thepeoplerisklandscapeisbroadeningtoencompassnewconcernsthat mightnothavebeenperceivedasemployee-relatedinthepast.ConsidertheGlobalRisksReport2024from theWorldEconomicForum(WEF),inpartnershipwithMarshMcLennanandothers,identifiedmisinformationanddisinformationasthetopglobalriskinthecomingtwoyears.Atthesametime,theimpactonemployeehealthofclimateevents—suchasheatwaves,floodsandwildfires—whichtraditionallyhavebeenviewedaspropertyrisks, isincreasinglyevident.Anagingworkforceisaddinglong-termhealthconcerns,aswellaspotentiallydeepeninglaborshortages. Stakeholders’expectationsofpeopleriskmanagementarealsointensifying.Itisnolongersufficienttohaveastrategyandevidencethatriskswithinanorganization’scontrolarecontained.Riskmanagementnowrequiresawiderecosystemviewthatidentifiesandaddressesissues,suchasthosewithinsupplychainsandtakesaccountofthewidercommunitiesinwhichabusinessoperates. PeopleRisk2024:Investinginyourpeople,protectingyourbusiness4 Concurrentcrisesimpactingbusinessesandtheir a i o n M e n t L a a l b h o e r a l s t h h o i o d r e t n t a e g ri e o s r workforcest lo o i r h n nog S lc lt cof ch c b uc ea i Te i i u o c r h c p s e s a e n t e o l t n s o r i f ie l t E p a r h n n ic ra o M l a ff x su t y t w i p s o d r s r i a e e e i o t r n l r t t l m a i t e c f u a i o a o o r o i c g s w n r z t o s e c e n m a u n e a e t s s s t n a i r h t e t i o e r r a o n t n e i v I o n e n f n l a t t s Businessleadersstrugglingtoaddressbreadthanddepthofinteractingrisks ver ous c di ti i io ec c m B f ni o d In o n r o Ch c i atu e N s n o I e G Figure1:Businessleadersstrugglingtoaddressbreadthanddepthofinteractingrisks 5 UK 310 Netherlands 110 France 110 Italy 110 Canada310 US1,024 Argentina110 Brazil110 Chile110 Colombia110 Mexico110 Peru110 Risk-rankingmethodology Poland110 Spain110 Turkey110 SaudiArabia110 UAE110 SouthAfrica110 China 310 HongKong 110 India 310 Philippines 110 Singapore 110 Thailand 111 Australia110 NewZealand110 Toestablishthepriorityorderofthe25risksinthisresearch,surveyrespondentswereaskedtoassesstheimpactandlikelihoodofeachriskontheirbusinessifitweretooccurinthenextonetotwoyears.Throughoutthereport,wecalculateandranktherisksbyRiskRatingScore(RRS).RRSisanumericscorethatcapturesthelikelihoodoftheriskimpactingtheorganizationandtheseverityofitsimpact.SeetheAppendixofthisreportformoreinformation. Howtousethisreport PeopleRisk2024:Investinginyourpeople,protectingyourbusiness 4,575HR andRiskprofessionalsweresurveyedin26marketsacrosseightregions. What Capturesattitudesaboutthemostsignificantpeoplerisksfacingorganizations,includingthechallengesorganizationsfacemanagingtheserisks. When DatacollectedbetweenOctoberandNovember2023. Who 2,283HRand2,292RiskprofessionalswithjobtitlesthatincludeHRDirector,ChiefHROfficer,HRManager,HRCoordinatorandVPofRiskManagement,ChiefFinancialOfficer,DirectorofFinance,DirectorofInsuranceandRiskManager,ChiefInformationSecurityOfficerandVPofHealtha