Regulatory fines and penalties arising from data protection breaches are the biggest issue for executives in the technology, media and telecommunications (TMT) sector, according to Willis Towers Watson research.
The new Willis Towers Watson TMT Risk Index 2016 revealed the top three risks include data protection fines and penalties, intellectual property and patent infringement, and competition law scrutiny.
Sara Benolken, head of TMT global industry at Willis Towers Watson, said: “While a fine from a data breach is perceived to be a top priority across the global TMT industry, the top three risks indicate that regulatory change and legal risk are foremost on senior management’s risk radar.”
The focus on data protection and potential liabilities is in line with a global trend for stricter privacy laws and tighter enforcement, according to Willis Towers Watson.
The General Data Protection Regulation, recently approved in the EU, significantly strengthens the penalties for data breaches and makes it easier for individuals to bring claims, highlighting that companies need to keep up with new regulatory requirements.
Benolken said: “While it is understandable that regulatory change and legal risk are front of mind, none of the identified risks ranking lower down the scale should be ignored, given their potential to either harm or grow a business.”
Meanwhile, the threat of a cyber attack did not make it into the top three risks for TMT as a whole, but it did rank number one for the technology sector.
Willis Towers Watson suggested companies not to overlook the fact that cyber vulnerabilities can exacerbate other risks such as those leading to data protection fines and penalties.
Its index found that digitalisation and technological advances are the most likely mega trends to affect TMT over the next 10 years.
