Get Ahead of The Curve: How CEOs & Boards Are Bearing Risk Liability

Let’s talk about the future as it relates to employment contracts in the C-suite. Gartner, Inc (“Gartner”) made their top eight cybersecurity predictions for 2022-2023 earlier this year, their 8th prediction on their list was that by 2026 half of C-level executives (Chief Executive Officers, Chief Technology Officers, & Chief Financial Officers) will have employment contracts with built-in performance requirements related to risk. This piece will go over the 8TH prediction from the list, and what that might mean to businesses and business leaders. 

The eighth prediction from Gartner list published at the Gartner Security & Risk Management Summit, focused on the importance of risk management and how important it is to business leaders today. This prediction can also extend to organization department heads and any other positions that oversee risk management efforts. According to Gartner, these contracts will help organizations prepare and mitigate risks and allow executives to adjust their roles accordingly with respect to the business they’re running.

Gartner Security & Risk Management Summit

The Gartner Security & Risk Management Summit is a great place to learn about the latest trends and predictions in the security and risk management industry. One of the biggest predictions this year from the summit was the importance of risk management, as more and more companies are now taking risk management more seriously.  This is leading to companies putting more ownership on their C-Level executives to ensure they are more accountable to cybersecurity risks.  

Based on some of the earlier forecasts, cybersecurity will be one of the business hazards that receives the most attention during the next four years. According to Gartner, incentive-based contracts for senior executives will likely be created and linked to their capacity to respond to possible cyber risks. This intends to increase C-level executives’ accountability for how they handle cybersecurity in the future. While this may sound like a lot of responsibility, these types of demands could potentially save the company millions or even billions in damages and losses due to data breaches or ransomware attacks. 

CFOs and other executives can help make sure everyone understands their role in protecting the company from significant risks through clear communication about potential consequences for not complying with specific policies. 

Knowing what constitutes acceptable risk levels can also go a long way toward establishing trust among stakeholders who worry that uncertainty might harm the company’s profitability.

The Definition Of Risk

Risk is the potential for something bad to happen. It’s the possibility that an event will occur that will have a negative impact on your business. There are many different types of risks, but all of them can potentially harm your business in some way. First, there’s the operational risk – things like human error and natural disasters. Second, there’s a strategic risk – things like changing customer needs and market shifts. Third, there’s the reputational risk – how customers view you and what they tell others about you. And finally, there’s a financial risk – anything related to how well your company does financially. 

Gartner predicts that by 2026, half of executives will be required to manage their performance based on these four areas as part of their employment contract with their company! They’ll have to think strategically, take risks prudently, build reputation, and ensure sound finances. Companies that don’t move toward this type of leadership structure may lose talented execs who want more security for themselves and their families when taking risks for the company.

Why Are The C-Suite Likely To Be Exposed To Greater Risk?

The c-suite is likely to be exposed to greater risk for a number of reasons. First, they are often the most senior members of an organization and have access to sensitive information. They are often responsible for making decisions that can significantly impact the organization, both positive and negative. They typically have a sizable financial stake in the organization and its success or failure. They are often under pressure to meet unrealistic deadlines or goals, which can lead to shortcuts being taken. Their influence may extend beyond the organization (e.g., via social media). 

C-level executives are more likely than other employees to have expertise in multiple areas (e.g., marketing, finance), which can increase their risk exposure. In some instances, one person may hold two or more roles at once within an organization, which multiplies their potential exposure to risk by their various areas of responsibility.

Gartner’s prediction does not imply that risk is necessarily acceptable or legal. Instead, it is a prediction about what we are likely to see regarding strategic decisions made by c-suite executives regarding managing their risk exposure. We expect c-suite executives will want employment contracts with built-in performance requirements related to managing risk.

The Future of Risk Management: Gartner’s 8th Prediction 

Consider investing in cybersecurity as an investment in the company and give it a top priority. According to Gartner’s forecasts, 60% of firms will utilize cybersecurity risk as a key consideration when performing third-party transactions and business engagements by 2025.

By 2025, 80% of businesses will have adopted a plan to consolidate access to the online, cloud, and private application services through a single vendor’s secured service edge (SSE) platform.

By 2026, the employment contracts of 50% of C-level executives will include risk-related performance objectives. More than three years ago, progressive board directors began holding CEOs responsible for their environmental, social, and governance (ESG) activities. Pay for CIOs is based on how much their departments help remove barriers to increased revenue and, most critically, how well they support sales in generating that revenue. Similar to how a CEO needs to be an expert at ESG efforts, risk management is a fundamental ability that both a CIO and CISO need to excel in their jobs. Background evidence has been accumulating progressively in favor of this prognosis for years.

Half of the C-level executives will have employment contracts by 2026 that include risk-related performance objectives. Boards now view cybersecurity as a commercial risk as well as a technical problem. As a result, senior business leaders will take over responsibility for cybersec from cybersecurity executives.

Who Else Might Be Affected?

Shareholders and board members will likely be affected by this prediction as well. For public companies, this could mean increased scrutiny from investors and regulators. And for private companies, this could mean more pressure to disclose information about risks. Employees could also be affected, as their jobs may become more at risk if their bosses don’t meet these new performance requirements. The downside is that it can result in overcompensation on the employer’s part, but overall, Gartner believes it is a positive trend because it forces executives to think more deeply about their risk management strategies.

How might you be affected? You might not see any changes immediately, but you should start thinking about how your job functions concerning risk. It might affect how you manage projects or interact with colleagues or clients, and there are always opportunities to make improvements where needed. Continue reading below to find out what Gartner predicts next!

Don’t Ignore Security Basics

If you’re like most people, you probably take security basics for granted. After all, who doesn’t lock their doors at night or keep their valuables hidden away? But the truth is, security basics are just as important for businesses as for individuals.  Why? Well, because cybercriminals aren’t interested in whether you have a nice lawn and shiny porch light – they only care about what makes them money, and that can be your data.

Even though companies are becoming more aware of the importance of security, they are still making basic mistakes that leave them vulnerable to attack. 

Here are some security basics that every company should follow: 

1) Use strong passwords; 

2) Don’t install software from unknown sources; 

3) Don’t click on suspicious links; and 

4) Report any suspicious activity to the IT department.

Evolve Your Security Strategy

Your organization must evolve its security strategy to stay ahead of the curve. Here are five ways to do just that:

1) Increase business awareness about cybersecurity risks by providing ongoing education for employees and management about threats in their industry and how they might be affected. 

2) Prioritize cybersecurity as a board-level issue, with oversight from key stakeholders like the chief information officer or chief compliance officer (CIO/CCO). 

3) Identify emerging threats through regular penetration testing and vulnerability assessments. 

4) Create an incident response plan and train personnel on what to do if an attack is successful. 

5) Implement data loss prevention solutions to detect sensitive data being transferred outside company networks. 

Gartner predicts that by 2026 there will be twice as many digital attacks every year compared to today’s average rate. These predictions outline how forward-thinking organizations need to work strategically and proactively with Gartner’s research insights, so they don’t get left behind later.

So how do you stay one step ahead? Start by following Gartner’s team of global subject matter experts for webinars and thought leadership content designed to help you understand today’s threats and learn how best to protect your business. 

Keep Up To Date On New Threats

It’s essential to stay up-to-date on new threats so you can be prepared for them.  How do we know this? Gartner has predicted it! By 2026 half of all chief executives will have employment contracts with built-in performance requirements related to risk. In addition, the same is expected for senior vice presidents and directors in the same time frame. There are many reasons why this prediction is being made – first off, more companies are looking at cybersecurity as a critical factor in talent management decisions. 

There is an increased awareness about cyber risks among employees, and people care more about security than ever before, which might make them less likely to accept offers if they feel their company doesn’t prioritize it enough. So what does this mean for your business now? If your current contracts don’t consider these issues, it’s time to update them. Keep up-to-date on security news and trends to prepare yourself for the future.

What Could This Mean For Today’s Business Leaders?

Today’s business leaders need to be prepared for the possibility that their employment contracts may include built-in performance requirements related to risk. This could mean they will be held accountable for any risks their company takes and may need measures to mitigate them. This could have a significant impact on the way that businesses operate and may require business leaders to rethink their strategies. This prediction from Gartner could have a few different implications for today’s business leaders. For one, it could mean that more and more companies will start to include clauses in employment contracts that hold executives accountable for risks taken. 

Additionally, this could also lead to an increased focus on risk management within organizations. As a result, business leaders must be prepared to identify and assess risks and implement mitigation plans. It is also possible that other changes are made due to this shift, such as looking at data protection in new ways or changing how organizations deal with customer data. No matter what happens, it is essential for today’s business leaders to be ready for anything.


It’s no secret that the business world is becoming increasingly risky. In response, Gartner has predicted that by 2026, half of all C-level executives will have employment contracts with built-in performance requirements related to risk. This means that companies are starting to take risks more seriously and are holding their executives accountable for them. While this may seem like a daunting task, it’s actually an opportunity for executives to show their value and prove their worth to their organizations. 

There are two types of contracts that businesses can adopt, one where the executive is rewarded if they are complete or reduce the negative impact of projects or deals, and another where they are penalized if they fail to achieve these goals. To help make sure employees get fair treatment regarding bonuses based on how well they deal with risk in their work environment, HR professionals should include specific expectations and measures for each type of contract in these contracts so as not to confuse employees.

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