According to a recent global survey, cyber-attacks and data loss are the top risks facing directors and officers, following pandemic-related changes that have occurred in the workplace over the last year.
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The top five risks identified were:
- Cyber-attacks (56%)
- Data loss (49%)
- Regulatory risk, including fines and penalties (46%)
- Health and safety prosecutions (41%)
- Risk of employment claims (38%)
Cyber-attacks and data loss have featured in the top three overall risks since 2016.
This has largely been down to the introduction of the GDPR that became effective in 2018, resulting in significant fines for those found to have breached data protection guidelines.
As employers have had to adapt during the pandemic, implementing processes that might not be fit for purpose to accommodate remote working for their teams, it is not surprising that this is one of the biggest areas of exposure for directors and officers.
Unfortunately, the pandemic has provided a fertile ground for many cyber criminals, who are able to exploit a weakness in IT infrastructures and individual user behaviour; circulating phishing emails that mislead, misinform and result in serious damage to the receiver.
Employment claims also placed highly on the list of top risk factors for organisations, which includes pandemic-triggered furloughs and layoffs, as well as returning to work and vaccination policies.
Other key findings in the report included diversity, climate change and bankruptcy, all proving to be issues that could potentially threaten directors and officers if not addressed.
It is also important that directors are aware of their financial reporting and tax liabilities, as mistakes on either of these could land you in serious trouble.
Even where unintentional, these oversights can be prosecuted due to negligence.
If you are in need of more information, we'd be more than happy to talk through your vulnerabilities and identify where the right policy could protect you.