EisnerAmper's survey among 250 board members found reputational risk at the top of board concerns like last year. The survey was conducted in early 2014. What is surprising about the findings is the big jump in cybersecurity/IT risk and the decline in concern over crisis management and disaster recovery. Clearly, the Target data breach was very much on the minds of board members at the start of the year. And for good reason--Target even lost their CEO over the breach. In addition, the focus on hacking and Edward Snowden's disclosures of top secret information from NSA had to be of great concern about the damage to reputation from IT failures. Interestingly, board members may be worried about cyber-risk but the American public does not see these cyber-attacks as particularly threatening dangers and are actually fairly complacent about them says a report mentioned in the WSJ today from the commission members who worked on the 2001 terrorist attacks.
CEO succession planning seems to be a middling concern to reputation-mindful companies according to board members. Apparently, nearly one out of every two board members surveyed think they have a heir in waiting. However, the other one out of two realize that they might not have the right candidate or one that is groomed and seasoned enough for the top job. As we have seen with Target, a CEO-elect was not in place. My bet is that they are looking for a wholesale change and the opportunity is right now to change the culture and get Target back on top. It can happen to the best of companies.