A new study conducted by Riskonnect reveals that only 17% of companies worldwide have formally educated their employees about the risks associated with generative AI. The report brings to light a significant gap in AI risk management, despite 93% of organisations acknowledging these risks. A mere 9% feel prepared to manage these threats. The study surveyed more than 300 risk and compliance professionals globally.
Jim Wetekamp, CEO of Riskonnect, commented, “Generative AI is taking off quickly, introducing a new wave of business risks. Our research indicates that most companies have been slow to adapt, thus creating vulnerabilities across various operations.”
The research, titled ‘The New Generation of Risk,’ delves into emerging threats and strategies for risk management. According to the study, today’s risk landscape is quickly evolving, with generative AI standing as a prominent example.
Key Findings on Generative AI Threats
The research identifies data privacy and cybersecurity issues (65%), decisions based on inaccurate information (60%), employee misuse and ethical risks (55%), and copyright and intellectual property risks (34%) as companies’ top concerns regarding generative AI.
Persistent Economic and Cyber Risks
Economic uncertainty and cyber concerns continue to be prevalent. The top four organisational risks currently are talent shortages and layoffs, recession risk, ransomware and security breaches, and state-sponsored cyberattacks.
Preparedness and Data Reliability Issues
A considerable 63% of companies have not simulated their worst-case scenarios. A mere 5% feel adequately prepared for unknown and unpredictable future risks. When it comes to data, only 23% of risk and compliance teams express high confidence in the accuracy, quality, and actionability of their risk management data. Just 5% are highly confident in their ability to generate risk insights to inform decisions.
Impact of Talent Shortages on Business
The study also highlights that talent shortages significantly affect business performance. Companies cite mistakes and shortcuts due to worker burnout (66%) and an inability to meet strategic goals (41%) as the major risks associated with labour shortages and layoffs.
Organisational Changes in Risk Management
According to the Riskonnect study, there has been a shift in organisational approaches towards risk management. Over half (52%) of the companies now have a chief risk officer, and 6% plan to hire one within the next 6-12 months. Despite layoffs in other areas, 82% of companies report that their risk management headcount has either increased or remained stable over the past six months.
Increased Investment in Risk Management
The study also notes that risk management departments are receiving more funding. Nearly a third of companies (28%) have reported an increase in their budget for risk management technology in the past six months.
Jim Wetekamp added, “We are witnessing meaningful and positive shifts in how companies identify, manage, and prioritise risk. Risk leaders today understand that the threat landscape is not static. They are preparing for worst-case scenarios, prioritising visibility across the enterprise, and investing in tools to tackle the interconnected spectrum of risk.”
Access the full report to dive deeper into the new generation of risk.
