New Risk Survey from North Carolina State University ERM Initiative and Protiviti Finds Regulatory Change Tops List of Risk

   New Risk Survey from North Carolina State University ERM Initiative and
  Protiviti Finds Regulatory Change Tops List of Risk Concerns for Companies
                          Across Multiple Industries

Board members and senior executives' concerns about strategic risks show
largest year-over-year increase, according to study

PR Newswire

MENLO PARK, Calif., Feb. 5, 2014

MENLO PARK, Calif., Feb. 5, 2014 /PRNewswire/ --Changes in the regulatory
environment and heightened scrutiny by regulators rank at or near the top of
risk concerns among corporate leaders regardless of industry, according to
Executive Perspectives on Top Risks for 2014 www.protiviti.com/TopRisks, a
just-released survey report by global consulting firm Protiviti
(www.protiviti.com) and the Enterprise Risk Management (ERM) Initiative at
North Carolina State University's Poole College of Management
www.erm.ncsu.edu.

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"The pressures created by regulators, plus the potential for major adjustments
in light of regulatory change, are understandably tremendous concerns and
present substantial risk. Having to comply with new regulatory requirements
can dramatically affect the profitability and growth of an organization," said
Dr. Mark Beasley, Deloitte Professor of ERM and director of the ERM Initiative
at NC State University. "Even organizations in industries that are less
heavily regulated can feel the indirect effects of new and changing
regulations, especially those affecting all types of organizations, on
profitability and growth."

This marks the second year in which Protiviti and the NC State ERM Initiative
conducted their study to identify the top risks on the horizon that are
driving risk conversations in boardrooms and C-suites. Respondents rated the
potential impact of each of 22 risks considered in the survey on a scale of
one to 10, with 10 being the highest impact. Despite a slight decrease in its
rating year-over-year, regulatory change and heightened scrutiny again ranked
as the top risk with a rating of 6.4 on the 10-point scale in the current
survey. Notably, financial services organizations and those in the healthcare
and life sciences industry group rated this risk substantially higher than the
average from other industries, with scores of 7.3 and 8.2 respectively.

Most executives rated the business environment as risky, although improving
relative to 2013. The 2014 scores for a majority of risks assessed in the
study are lower than their respective scores in the prior year, suggesting a
slight improvement in the risk environment. Interestingly, board members
appear to view the business environment as more risky than does management. By
contrast, CEOs seem to have the most optimistic views about the risk
environment.

"One possible reason for directors perceiving the business environment as
riskier than management does is that the risks with the highest ratings were
primarily strategic in nature and many directors tend to focus more on
strategic rather than operational issues," said Jim DeLoach, a managing
director with Protiviti. "With respect to CEOs, they tend to focus heavily on
the strength of markets. The global economy was showing signs of improvement
during the survey period, which could have had a positive influence on the
participating CEOs, resulting in a lower assessment of macroeconomic and
strategic risks."

The Top Ten Risks

According to the 374 survey respondents, who included board directors, C-suite
executives and other top management from companies across a range of
industries, the top 10 risks that present the greatest concerns this year are:

1.Regulatory changes and heightened regulatory scrutiny
2.Economic conditions restricting growth
3.Uncertainty surrounding political leadership affecting U.S. and
    international markets
4.Challenges related to succession-planning and talent acquisition/retention
5.The ability to grow organically through customer acquisition
6.Cyber threats that have the potential to disrupt core operations
    significantly
7.Resistance to change restricting necessary adjustments to the business
    model and core operations
8.Privacy/identity management and information security/system protection
9.Anticipated volatility in global financial markets and currencies
10.Uncertainty surrounding costs of complying with healthcare reform
    legislation

The survey was conducted in the fourth quarter of 2013. Respondents represent
both U.S.-based and non-U.S. organizations and public and private companies.
The report also breaks out survey results by size of company, position and
industry, and offers implications of the survey results for organizations and
suggestions of how to respond to these top risks.

"Managing uncertainty across a multitude of business issues continues to be a
challenge that companies struggle with," said Patrick Scott, Protiviti
executive vice president, global industry programs. "It's critical that
organizations continue to prioritize risk management strategies to ensure that
they are prepared to address emerging issues. These survey results should
serve as a catalyst for an updated assessment of risks within organizations."


Resources Available: Webinar, Video, Infographic, Podcast and Benchmarking
Tool
The report from Protiviti and NC State Poole College's ERM Initiative,
Executive Perspectives on Top Risks for 2014, along with an infographic and a
video of key survey results, is available for complimentary download at
www.protiviti.com/TopRisks and www.erm.ncsu.edu. A podcast featuring DeLoach
and Beasley discussing the major findings from the study is available at:
www.protiviti.com/podcasts.

Additionally, Scott, DeLoach and Beasley will host a one-hour webinar to
discuss the survey findings on February 11 at 10:00 a.m. PST. To register for
the free webinar, please visit http://www.protiviti.com/webinars. CPE credit
will be provided to qualifying participants.

Executives can also compare their views about risks that are likely to affect
their organizations in 2014 to the survey findings online using Protiviti's
Benchmarking Tool, available at www.protiviti.com/TopRisks.

About Protiviti
Protiviti (www.protiviti.com) is a global consulting firm that helps companies
solve problems in finance, technology, operations, governance, risk and
internal audit. Through its network of more than 70 offices in over 20
countries, Protiviti has served more than 35 percent of FORTUNE 1000® and
FORTUNE Global 500® companies. The firm also works with smaller, growing
companies, including those looking to go public, as well as with government
agencies.

Protiviti is a wholly owned subsidiary of Robert Half (NYSE: RHI). Founded in
1948, Robert Half is a member of the S&P 500 index.

About the North Carolina State University ERM Initiative
The Enterprise Risk Management (ERM) Initiative in the NC State University
Poole College of Management provides thought leadership about ERM practices
and their integration with strategy and corporate governance. Faculty in the
ERM Initiative frequently work with boards of directors and senior management
teams, helping them to link ERM to strategy and governance, host executive
workshops and educational training sessions, and to issue research and thought
papers on practical approaches to implementing more effective risk oversight
techniques (www.erm.ncsu.edu).

Protiviti is not licensed or registered as a public accounting firm and does
not issue opinions on financial statements or offer attestation services.

Editor's note: photos and an infographic (in JPEG or PDF) are available upon
request.

SOURCE Protiviti

Website: http://www.protiviti.com
Contact: Kathy Keller, +1-650-234-6252, kathy.keller@protiviti.com
 
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