A research survey of more than 300 risk and compliance professionals conducted by Riskonnect finds that while 93% of companies recognize the risks associated with using generative AI inside the enterprise, only 9% say they’re prepared to manage the threat. The survey finds that only 17% of risk and compliance leaders have formally trained or briefed their organizations on the risks of using generative AI.
“Generative AI is taking off at lightning speed and ushering in a new wave of business risks,” said Jim Wetekamp, chief executive officer, Riskonnect. “Our research shows that most companies have been slow to respond, which creates vulnerabilities across the enterprise. The risk of generative AI is the latest example of how quickly today’s risk landscape evolves. We’ve officially entered a new generation of risk.”
Riskonnect’s research explores new threats facing organizations and the strategies risk management teams are using to navigate the uncharted territory. Key findings include the following.
- The generative AI threat is broad and interconnected. Companies’ top generative AI concerns include data privacy and cyber issues (65%); employees making decisions based on inaccurate information (60%); employee misuse and ethical risks (55%); and copyright and intellectual property risks (34%).
- Economic uncertainty and cyber concerns remain a persistent threat. The top four risks affecting organizations today are talent shortages and layoffs, recession risk, ransomware and security breaches, and state-sponsored cyberattacks.
- Companies could be doing more to manage risk. About 63% of companies haven’t simulated their worst-case scenario, while only 5% of companies feel prepared to assess, manage, and recover from a future unknown and unpredictable risk event.
- Unreliable data hinders risk and compliance teams. Only 23% of companies say they’re very confident in the accuracy, quality, and actionability of their risk management data. Just 5% of companies are very confident in their ability to extract, aggregate, and report on risk insights to fuel decisions.
- Today’s talent shortages heavily impact business performance. The biggest risks companies associate with labor shortages and layoffs include mistakes and shortcuts driven by worker burnout (66%) and an inability to reach strategic goals (41%).
The evolving threat landscape, along with market-shaping disruptions over the past several years, has forced organizations to rethink how they approach enterprise risk management.
Riskonnect’s research found that 52% of companies now have a chief risk officer, with another 6% planning to hire one within the next six to 12 months. Risk management functions are also growing, despite layoffs elsewhere, with 82% of companies saying their headcount for risk management has increased or remained the same in the past six months.
Risk departments are also getting more funding. Approximately 28% of companies have reported budget increases for risk management technology in the past six months.