VS1 Cloud Blog
Most businesses (83%) are being or expect to be investigated in the next 12 months, according to FTI Consulting’s 2021 Resilience Barometer report. The consulting firm surveyed 2,869 decision-makers in large companies across the G-20 countries.
The top three investigation concerns identified by business leaders are business conduct and the treatment of customers; sustainability and ESG practices; and the company’s relationship with public bodies and government contracts. Approximately 30% of respondents tagged the above areas as leading concerns.
The services sector and financial sector were likeliest to report experiencing regulatory or political scrutiny in the past 12 months (23% each).
“Covid-19 has exposed and exacerbated economic and social fault lines — employee wellbeing, talent shortages, treatment of customers, financial crime, and cybersecurity all have risen up the corporate agenda, and businesses are responding to protect value and build resilience as they look towards future growth,” said Caroline Das-Monfrais, a senior managing director and global resilience lead at FTI Consulting.
Cybersecurity remains a key area where companies are looking to boost resilience as threats have multiplied in the pandemic era. The FTI survey found that 78% of companies suffered a cyberattack in the last 12 months, with phishing attacks the most common form (34%). The stakes are high for successful breaches, with potentially massive damage to finances, brand, and reputation.
Thirteen percent of respondents said they had experienced class actions and mass consumer claims in the last 12 months, with the same amount expecting this to continue in the next year. One-third believe class action suits are becoming more costly for their business.
Firms also continue to battle talent scarcity issues, with 30% saying the are under “extreme” pressure to retain talent, while the same amount are reporting a shortage of talent and skills. Meanwhile, the pandemic has impacted employee wellbeing, with 68% of leaders reporting increased mental health issues in their workforce. To retain stressed employees in a tight labor market, 29% of business leaders said they are under “extreme” pressure to improve corporate culture in the next 12 months.
“The ever-changing landscape will put the onus on companies to take a proactive stance regarding investigations,” said Edward Westerman, global investigations initiative leader at FTI Consulting. “Leveraging new technologies and data and analytics can help companies efficiently manage an ongoing investigation and help mitigate the risk of future crises."
Approximately 80% of respondents said they are using AI and analytics to monitor for risk scenarios. Meanwhile, 29% are using M&A to acquire data assets and one-third are using acquisitions to add tech platforms and systems. Nonetheless, more than two-thirds (69%) say they are struggling to digitalize their business.