From: Wall Street Journal By Jack Hagel
Jan. 19, 2021 4:23 pm ET
Business-risk prognosticators are focused on the future of work—and the challenges that an increasingly remote workforce could continue to pose—in 2021.
The transformation of work in the past year, due in large part to the coronavirus pandemic, has heightened dangers related to business continuity, cybersecurity, culture and talent management, organizations that monitor enterprise risks say.
In the year ahead, organizations are expected to face those and new risks related to returning to the office—ranging from employee retention, workplace safety and liability issues raised by employees, risk management organizations say.
The World Economic Forum on Tuesday warned that companies and their workforces are under pressure as a result of financial, digital and reputational threats resulting from the pandemic.
“As businesses transform their workplaces, new vulnerabilities are emerging,” Carolina Klint, a risk management leader at insurance brokerage Marsh, said in a statement accompanying the release of WEF’s Global Risks Report 2021. “Rapid digitalization is exponentially increasing cyber exposures, supply chain disruption is radically altering business models, and a rise in serious health issues has accompanied employees’ shift to remote working,” Ms. Klint said.
Some of those risks emanate from employees depending on home networks, which can be less stable and less secure than corporate networks, risk management experts say.
Companies also face challenges as they ask more employees to return to the office. Businesses are working through ways to ensure safe work environments, such as determining how many people can occupy an elevator at one time. Some are also grappling with whether to require employees to be vaccinated, according to executives at Navex Global Inc. The Lake Oswego, Ore.-based risk and compliance software company listed network security and return-to-office issues among its top risk trends for the year ahead.
“There’s a lot of risk to employers in 2021 rushing to bring their people back to the office,” said Bob Conlin, Navex’s chief executive. “Employers need to be aware of what the legal ramifications will be if there are health-related issues related to employees coming back,” Mr. Conlin said.
Companies could face lawsuits from employees who contract Covid-19 at the office, risk management experts said.
Another key risk: Employees who have become accustomed to working at home may be reluctant to return to the office. Companies may need to offer more generous work-from-home options to retain and compete for talent in the future, according to the Institute of Internal Auditors, which listed talent management as one of the “most relevant” risks facing organizations in its 2021 outlook.
There could be knock-on legal risks related to hiring a remote workforce in new jurisdictions—from ensuring local labor, employment and data security laws are followed to ensuring external business partners are also managing issues such as cyber risks, said Anthony J. Pugliese, who will become the IIA’s chief executive in March.
“Someone can burrow their way into a company’s network by someone who has an unprotected laptop or uses an open computer that doesn’t have a [virtual private network] attached to it,” Mr. Pugliese said. “It increases the risk for any kind of proprietary data that a company would have.”
Remote work could also put some business relationships at risk—particularly those that rely on in-person meetings, said David Fisher, a partner at McLean, Va.-based advisory firm Guidehouse.
“Every entity is going to be trying to figure out what are the ongoing risks of my client base becoming more in-person again but my employees don’t want to be?” he said in an interview. “How do I manage that?”