Boards today face a rapidly evolving risk landscape.

From technological disruptions to shifting societal expectations, the risks directors and councillors must address are becoming more complex and interconnected.

Here are the top five emerging risks that boards should have on their radar—and strategies to tackle them head-on.

1. Cybersecurity threats 

 

As cyberattacks become more sophisticated, organisations of all sizes are at risk of data breaches, ransomware, and system disruptions. 

In Q2 2024, research from Check Point suggests a 30% YoY increase in cyber attacks globally. 

It’s not a case of if, it’s when.

For boards, the responsibility to oversee cybersecurity strategy is critical.

 

 

How to prepare:

• Conduct regular risk assessments. Engage third-party experts to identify vulnerabilities in your systems.
• Implement robust cybersecurity protocols. Ensure all staff are trained in recognising phishing attempts and other threats.
• Invest in incident response planning. A clear crisis plan can minimise downtime and financial loss.
• Utilise board management software like Stellar for cloud-based document management and additional security features like two-factor authentication and audit trails.

2. Climate change and ESG compliance 

 

Climate change and the global push for sustainability are forcing organisations to rethink their long-term strategies. 

Boards must balance profitability with environmental responsibility to meet stakeholder expectations.

Regulatory bodies are increasing their focus on Environmental, Social, and Governance (ESG) compliance,
holding boards accountable for sustainable practices.

 

 

How to prepare: 

• Develop and monitor a comprehensive ESG strategy, ensuring alignment with global frameworks like the UN Sustainable Development Goals.
• Facilitate regular scenario planning sessions to anticipate the impact of climate-related risks such as extreme weather or regulatory changes 
• Encourage investment in sustainable products, services, and operations.
• Use board management tools like Stellar to make board processes paperless, improving sustainability.

3. Workforce evolution

 

The rise of remote work, labor shortages, and shifts in employee expectations pose significant risks to organisational stability and growth.

Boards must oversee strategies that address workforce retention, mental well-being, and skills development.

A recent report from PWC found that more employees say they’re likely to change employers in the next 12 months than even during the ‘great resignation’ of 2022.

 

 

How to Prepare:

• Regularly review and refine the organisation’s talent strategy, with input from HR leaders and external consultants.
• Invest in leadership development. Equip leaders with the skills to manage hybrid teams effectively.
• Foster a strong organisational culture. Emphasise values that attract and retain top talent.
• Monitor trends. Stay ahead by understanding generational shifts and changing workforce priorities.

4. Technological disruptions

 

Emerging technologies like artificial intelligence (AI), blockchain, and quantum computing are reshaping industries. 

Research has found 83% of companies claim that AI is a top priority in their business plans.

And, the AI industry value is projected to increase by over 13x over the next 6 years

Boards that fail to adapt risk falling behind competitors.

 

 

How to Prepare:

• Stay informed. Allocate time for technology briefings in board meetings.
• Adopt agile governance. Foster a culture of experimentation to quickly evaluate and implement new technologies.
• Partner strategically. Collaborate with tech firms or startups to gain insights and capabilities.

 

Final words on emerging risks for boards 

Emerging risks are not just challenges—they’re opportunities for boards to demonstrate leadership and resilience. By proactively addressing these risks, boards can safeguard their organisations while positioning them for sustainable growth.

At Stellar, we provide the tools boards and councils need to navigate today’s complex risk environment. From secure document management to real-time collaboration, Stellar empowers you to make informed decisions, faster. 

Get in touch and discover how Stellar can help your board thrive.