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Ernst & Young study shows HR risk among global executives' top concerns
19 December 2008:
Human Resources (HR) risks are the challenges and opportunities inherent in managing an organization’s people, programs and processes, both inside and outside the walls of the business. By anticipating and proactively addressing these issues, executives in the C-suite, HR and finance areas can create significant, sustainable business results. Failure to manage HR risks properly, on the other hand, can leave a company open to significant financial and reputational consequences, in addition to hindering performance improvement efforts.
HR risks can be hard to identify. Findings from a new report by Ernst & Young LLP show many organizations do not fully understand the impact of these issues. The report, entitled 2008 Global HR Risk: From the danger zone to the value zone – accelerating business improvement by navigating HR risk, highlights the results of a survey of finance, human resource and risk executives from global Fortune 1000 companies. The survey’s purpose is to provide insight into global executives’ perceptions of HR risks as well as the awareness of these issues within these global organizations.
Key findings include:
- HR issues are among the top five business risks affecting an organization’s results and among the top three business risks most likely to occur.
- When asked which HR risk areas are more likely to grow over the next three years, respondents indicate the areas of strategic risk (43%) and compliance risk (30%) as top priorities, with operational risks (20%) and financial risks (7%) following suit.
- According to the survey, respondents may be underestimating the magnitude of HR risks and their potential impact on the organization. Only 29% of survey respondents say their corporate risk budget will increase in the next year, while 57% say the budget will stay the same and 2% say it will decrease.
2008 Global HR Risk: From the danger zone to the value zone – accelerating business improvement by navigating HR risk spotlights thinking from executives in global Fortune 1000 companies on how organizations currently anticipate and manage HR risks today.
Download the report
Source: Ernst & Young
