What are the ethical risk factors business leaders are most concerned about in 2024?

19 February 2024

Tags: Corporate governance, Pay, Tax, Technology, Human rights, Treatment of Employees

In this blog, Sam Lawal, IBE's Researcher, discusses the results of the Ethical Risks 2024 survey.

Business ethics is not static, often reflecting what is going on locally, regionally, and internationally. In the past couple of years, we have had major global geo-political events that have had significant societal and economic impacts on individuals and businesses, such as high inflation rates, high energy costs, rising cost of living, and supply chain disruption to name a few. In the UK, the cost of living crisis has been a particular issue affecting businesses and their customers, employees, suppliers, the local communities they operate in, and all other stakeholders. Unsurprisingly, businesses are thinking about what strategies to adopt to support their employees, and vulnerable customers in these challenging times.

The idea that events occurring from a distance can raise real ethical concerns for businesses at home, reinforces the importance of business leaders being aware of factors that can pose reputational, operational, and financial risks to the business. In the IBE Business Ethics Framework, risk assessment is the starting point in creating ethics programmes. This is based on the belief that understanding ethical risks is a necessary first step for acting on ethics in any organisation.  The Ethical Risks survey was therefore conducted to capture and report business leaders’ rating of ethical risk concerns for their businesses.

In the survey, ‘ethical risk’ refers to risks that could affect the ability of the organisation to live up to its ethical values and standards, undermining trust and reputation and threatening financial and operating performance. The IBE identified thirty-eight ethical risk factors based on literature and discussions with our supporters and asked business leaders to rate these factors by level of concern to provide a hierarchical ranking list. The results of the survey provide some tangible insight into the overall ethical risk concerns of business leaders, as well as variations at business size, and sector level.

Economic conditions are the highest-ranked risk factor that business leaders are concerned about in 2024, and understandably so, given the wide-reaching impact on businesses and their diverse stakeholders. Tough economic conditions are also seen as a driver of other risks such as fraud,  theft or improper spending of company money (including expenses) and false accounting and reporting which emerged as the 3rd, 7th, and 10th highest-ranked risk factors respectively.

According to a report published by Kroll in February 2024, organisations were viewed to be generally prepared for direct cyberattacks in 2023, however, they were particularly vulnerable to business email compromise (BEC), and third-party security risks. In our survey, data protection and privacy are ranked as the 2nd highest ethical risk factor, reflecting the continued prioritisation of this issue, and the significant challenges businesses face in keeping data safe.

Health and safety at work ranked as the 4th highest ethical risk factor, reflecting an ongoing post-pandemic challenge. It is a bigger concern for business leaders of small and medium-sized firms compared to larger ones, as well as for businesses in the construction, energy, health and social work, and education sectors. Treatment of vulnerable customers and fair treatment of customers emerged as the 5th, and 6th highest-ranked risk factors respectively. The retail sector and small and medium-sized businesses ranked these issues highly, but, perhaps surprisingly, large organisations prioritised these critical issues much lower. Large organisations were much more concerned by risk factors related to workplace behaviour, such as discrimination, sexual harassment and bullying, likely because of the higher potential of reputational impact in a zero-tolerance climate.

Lying in employment applications/falsification of qualifications/experience is in 8th place. Business leaders in the financial services and the insurance sector ranked it as the highest risk factor. The high ranking of this issue may be due to the increasing use of AI in job applications and for falsification of credentials. Fair pay and employment conditions ranks at 9th place, suggesting that business leaders are concerned about treatment of employees. The IBE’s Attitudes of the British Public to Business Ethics survey shows that the British public are consistently concerned about pay, especially executive pay.

There were some notably low-ranked risk factors. Use of artificial intelligence was ranked as 31st. Given the ongoing discourse on this issue, this is a surprising finding. Although business leaders may not view this as an issue of concern now, this may change in the future. Similarly, climate-related risks were rated much lower than might have been expected. Contribution to climate change, and wider environmental impact of business operations and of products and services were ranked 22nd and 34th respectively. With the World Economic Forum Global Risk Report 2024, commenting that environmental risks “could hit the point of no return”, this is a concerning finding. However, business leaders in the manufacturing sector did rank contribution to climate change as the 3rd highest risk factor.

It is the IBE’s hope that the Ethical Risks 2024 survey data will provide a broader understanding of the ethical risks faced by business leaders in 2024 and enable organisations to compare their ethical risk analysis to others when developing strategies, policies, and programmes that can be both effective and ethical.

Download the survey...
IBE Survey - Ethical Risks 2024


Dr Samuel Tosin Lawal
Dr Samuel Tosin Lawal


As a Researcher at IBE, Sam plays a crucial role in supporting the development, delivery, and dissemination of both internal and external research and advisory projects. Sam's passion lies in harnessing the potential of both quantitative and qualitative data to foster a culture of ethical considerations within business practices and policies, ultimately contributing to a broader societal impact.

Before joining IBE, Sam held the position of Research Officer for the University of Reading's Research Culture Project. In this role, he led research initiatives aimed at enhancing the research environment within the university. Additionally, Sam worked part-time as an Associate Lecturer at Henley Business School, where he delivered Undergraduate Business modules and supervised Master's dissertations in Marketing.

Sam holds a degree in Accounting from Babcock University, Nigeria, and an MSc in Business Analytics and Management Science from the University of Southampton. Notably, in 2018, he secured the prestigious Henley Business School Marketing and Reputation PhD Scholarship. This accomplishment led to the successful completion of his PhD in Marketing and Reputation from the University of Reading, where his thesis investigated the malleability of public attitudes and behaviours to organisational stories incorporating stakeholders' perspective.

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