Health and Safety Top Risk for Global Directors in 2024

Health and safety risks have emerged as the top concern of directors and officers worldwide, according to the 2024 Global Directors’ and Officers’ Survey Report from broker WTW and law firm Clyde & Co.

The survey, which covers regions including the U.K., Europe, Asia, Australasia, Latin America, North America, Africa, and the Middle East, found that 84% of global directors, officers, and risk managers ranked health and safety as very or extremely important to their organization, up from 48% a year ago.

This was closely followed by the risk of cyberattacks, including cyber extortion, at 79%, up from 62%. Data loss, which ranked as the second-highest threat in 2023 at 62%, has now dropped to third place overall, even though 78% of respondents said it was of concern to directors and officers.

“With regards to the increasing importance of health and safety risks for boards to consider, we shouldn’t forget the focus on mental health, particularly following COVID-19 with home working so
much more common,” Ben Horandi, insurance adviser to National Grid PLC, stated in the report.

By industry, health and safety ranked as the top risk of concern to directors and officers in the industrial, health care and energy and utility sectors. It was the No. 2 concern at services organizations, and ranked fourth in the finance and insurance sector.

For the first time since 2019, the threat of an organization being a victim of crime has dropped out of the top seven risks identified by global directors. New entrants in the top seven risks for directors and officers include systems and controls and breach of sanctions, reflecting heightened geopolitical tensions and the increasing complexity of corporate governance.

While not in the top seven risks globally, the importance of climate change remains high in regions such as Asia, Australasia, and the Middle East, where it has been identified as a top seven risk. A significant portion of respondents are also exploring or using captives and other mechanisms, indicating a strategic approach to managing D&O risk despite softer market conditions.

“We strongly recommend that organizations prioritize evolving their risk management practices, addressing the emerging threats, particularly around health and safety,” said Jeremy Wall, global head of FINEX for WTW.

Risk managers are central to keeping a board informed of emerging risks, the report shows. Asked how directors monitor and keep updated on emerging risks, risk managers was the top response, cited by 65% of respondents. Lawyers ranked second, at 59%, followed by consultants, insurance brokers and accountants, each cited by 43%.

“The report underscores the dynamic and complex nature of the risk landscape currently facing directors. What we have seen is that there is a pressing need for better education on D&O insurance and indemnification practices to ensure directors and officers are comprehensively protected,” said James Cooper, partner and global chair of the insurance practice for global law firm Clyde & Co.

The report also includes details on D&O insurance protection, limits and priorities. To view the complete report, visit the WTW website. &