In the riskiest business environment in more than ten years, talent woes continue to top the list of concerns

Middle Eastern organizations rate succession challenges and the ability to attract and retain top talent amid a tightening labor market as the biggest risks they face in 2023, according to a new survey from Protiviti and NC State University. The report also reveals that senior decision-makers in the region remain concerned about broader macro risks, such as the softening economy and the state of global supply chains.

The 11th annual survey, titled "Executive Perspectives on Top Risks for 2023 and 2032," was conducted by global consulting firm Protiviti and NC State University Poole College of Management's Enterprise Risk Management (ERM) Initiative. The study surveyed 1,304 board members and C-suite executives from organizations around the globe in various industries, asking them during September and October 2022 to rate 38 macroeconomic, strategic and operational risks for 2023 and a decade ahead (2032).

The Top Risks for 2023

Globally, three of the top four risks highlighted by survey respondents for 2023 are related to talent, continuing a trend reported in last year's survey. Of the 38 risks included in the survey, the top five risks identified by global business leaders for the coming year are:

1. Organizational succession challenges and ability to attract and retain top talent
2. Economic conditions (including inflationary pressures)
3. Increased labor costs
4. Resistance to change in company culture
5. Uncertainty surrounding organizational core supply chains

Looking ahead to 2032, talent attraction and succession planning remain a primary concern, especially the need for tomorrow's talent to become fluent in a series of fast-moving emerging technologies such as quantum computing, advanced AI and the metaverse.

The Top Risks Through 2032

Survey respondents also rated the expected impact of the 38 risks in 2032, assessing how the risk landscape might shift over the coming decade. The top five risks identified for 2032 are:

1. Organizational succession challenges and ability to attract and retain top talent
2. Adoption of digital technologies requiring reskilling and upskilling employees
3. Speed of disruptive innovations enabled by advanced technologies
4. Resistance to change in company culture
5. Ensuring data privacy and compliance with growing identity protection expectations and regulations 

"In the current tight labor market, talent retention has naturally become a top risk that executives are worried about. However, with the added complication of a softening economy, they need to tread carefully," said Pat Scott, EVP, Global Industry and Client Programs, Protiviti. It's important that executives weigh today's economic pressures against the possible costs a decade from now and make prudent organizational choices that increase their company's resilience next year while laying the foundation for success in the years to come."

"This year's survey results should drive proactive leaders to take action," said Jim DeLoach, a Protiviti managing director and co-author of the report. "Executives should weigh the current economic conditions to adjust their talent and risk management strategies. Employees are just as important as customers and should be treated as such in all decision-making in the coming months. Longer term, continued investment in succession planning, integrated upskilling and technology learning will help companies excel in employee engagement and broader corporate strategy, fulfilling the value proposition underpinning investments in new technologies and digital innovation."

Mark Beasley, professor and director of the Enterprise Risk Management Initiative, Poole College of Management, NC State University and co-author of the report, said: "It's clear that uncertainty abounds across the economy, which has triggered heightened risk concerns for executives and boards. The overall severity and magnitude of risks are at the highest level we've observed over the last 11 years this study has been conducted."

Thinking a decade ahead to 2032, survey respondents still had talent retention and succession planning top of mind, but this concern reflects longer-term uncertainty over rapidly advancing emerging digital technologies and the privacy and security risks they may bring.

"Looking back ten years ago, it's remarkable how much technology has reshaped the workplace since then, and the pace of change will only accelerate in the next decade. Technologies like the cloud, enterprise-grade AI, quantum computing and the metaverse were immature or nonexistent ten years ago but might become table stakes by 2032," said Carol Beaumier, a Protiviti senior managing director and global leader of the firm's thought leadership program. "Companies need to think about how their people will continue to adapt, learn and embrace these technologies. A long-term outlook helps companies focus on where to invest to be better prepared and more resilient beyond 2023."

Survey Resources Available

The "Executive Perspectives on Top Risks for 2023 and 2032" report from Protiviti and NC State University provides survey results broken by company type, size, industry, geographic region and respondent role. In addition, the report includes recommendations of important steps executives should take to maximize their organizations' chances of future success while mitigating their risk profile, as well as diagnostic questions to consider when evaluating their organization's risk assessment and risk management processes.

The survey report, along with an executive summary, infographic and podcast, is available for complimentary download here and on NC State's website. Protiviti will host a one-hour webinar on January 11, 2023, at 9:00 a.m. PST/noon EST with a panel featuring Beasley, Beaumier and DeLoach who will be joined by Kim Bozzella, Protiviti global leader of Technology Consulting and Fran Maxwell, Protiviti global leader of the Workforce and Organizational Transformation practice, to discuss the implications of the Top Risks survey's findings. Attendance is complimentary with registration here.