Inflation, cyber threats, AI governance, climate exposure and regulatory change are interacting in ways that directly influence India Inc’s performance and resilience.
Key Points
- AI is emerging as a dual risk area, where both under-adoption and weak governance are sources of concern.
- 54% feel AI-related risks, including ethical and governance issues, are not effectively managed
- 64% of those surveyed report talent shortages and skill gaps
Cybersecurity breaches have emerged as the top risk shaping organisational performance, with 61 per cent of respondents identifying it as the primary risk, said a Ficci and EY report.
Almost 59 per cent of executives surveyed also point to limited adoption of emerging technologies, such as artificial intelligence (AI), affecting operational effectiveness.
Other key risk factors
That is closely followed by changing customer demands and expectations at 49 per cent while 48 per cent point to geopolitical events as a key risk factor.
AI is emerging as a dual risk area, where both under-adoption and weak governance are sources of concern.
At the same time, 54 per cent feel AI-related risks, including ethical and governance issues, are not effectively managed.
Cybersecurity, which is no longer confined just to the responsibilities of the chief security or information officer, is a mainstream boardroom topic.
More than half report potential data theft and insider fraud as significant risks, and 47 per cent acknowledge difficulty in addressing increasingly sophisticated cyber threats.
“In a business environment shaped by volatility, the ability to anticipate, absorb and adapt to risk is emerging as a defining capability for sustained growth.
"The report indicates that organisations are moving away from treating risk as episodic and are instead embedding it into strategic decision-making, governance structures and long-term planning,” said Rajeev Sharma, chairman of Ficci Committee on Corporate Security & DRR, in a statement.
Businesses today are marked by ...
The report says that businesses today operate in an environment marked by persistent uncertainty and rapid change.
Against the backdrop of economic volatility, climate-related risks, increasing cyber vulnerabilities, accelerated technological disruption and evolving geopolitical realignments, effective risk anticipation and management have become critical to long-term sustainability.
While cybersecurity remains the main risk, workforce challenges persist too.
About 64 per cent of those surveyed report talent shortages and skill gaps influencing organisational performance and long-term capability planning.
Around 45 per cent of respondents indicate that non-compliance with environmental, social and governance (ESG) disclosure requirements has a direct impact on their organisation.
ESG also emerged as a key risk
ESG also emerged as a key risk. Nearly 44 per cent believe non-compliance with ESG disclosure mandates and reporting requirements may have a significant impact.
Additionally, 42 per cent of executives expressed concerns about the effectiveness of board oversight on ESG-related issues.
Sudhakar Rajendran, risk consulting leader at EY India, says organisations are navigating a phase where multiple risks are converging rather than occurring in isolation.
Inflation, cyber threats, AI governance, climate exposure and regulatory change are interacting in ways that directly influence India Inc’s performance and resilience.
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