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Boards of Directors Increasing their Risk Appetite

We can’t deny the fact of the growing Economic Uncertainty, Competitive Threats and Cost Inflation Cited as the Biggest Risks to Business Performance. Fifty-seven percent of Boards of Directors have increased or expect to increase their risk appetite heading into 2022, according to a new survey from Gartner. The Boards of Directors cite economic uncertainty (38%), disruptive business models from competitors (35%) and cost inflation due to supply shortages (28%) as the top risks to business performance. The Survey was conducted via an online survey from May through June 2021 among 273 respondents in the U.S., Europe and APAC in a board of director role or a member of the corporate board of directors. During the pandemic, the Boards of Directors recognized that they needed to become comfortable operating in an environment of significant risk, as standing still was not an option. “This drove them to embrace the ‘try fast, fail fast approach,’ and in 2022, the Boards of Directors will continue taking risks such as making technology investment decisions with incomplete information or making financial bets without up-front visibility around a guaranteed return.

Digital Technology Remains a Top Priority and the Boards of Directors remain highly committed to digital technology initiatives, which was ranked as a top strategic business priority by 58% of survey respondents. However, this is a slight decrease from the 2021 survey. Having invested so much in digital business over the past 12 to 18 months, enterprises are taking a pause to validate their strategy and ensure ROI. For Boards of Directors, the core focus is now on technology integration and creating a more enduring and systemic digital economic architecture, where technology is infused throughout the business and drives business outcomes. The survey further elaborates and found that 64% of Boards of Directors hav.