An Economist Enterprise Report supported by FTI Consulting
Steady Advisers for an Unsteady Age
In a world defined by disruption, there is no shortage of potential crises. As the type and number of crisis events multiply, judgment becomes more valuable than ever.
Geopolitical, socioeconomic, technological and environmental risks are increasingly interconnected. Crises today often overlap, reinforce one another and create far-reaching consequences.
General counsel (“GC”) are relied on more and more to see the warning signs earlier, frame the necessary trade-offs and guide the organization’s response. Yet many are fulfilling this expanded remit within structures that were designed for a different
era of risk.
Disruption is rising, but readiness is not
Preparing for crises before they become crises
The proactive approach gap
Fewer than a fifth of organizations deploy the most advanced proactive approach that can enable them to effectively manage crises.
The crisis information gap
Less than 50% of organizations deploy advanced solutions for risk scanning and crisis anticipation. Among organizations with a proactive crisis-management approach, adoption rates are consistently higher.
All organizations
Organizations with a proactive crisis management approach
Third-party risk intelligence platforms
50%
60%
AI-enabled monitoring of external signals
46%
61%
AI-enabled monitoring of internal operational, compliance or financial data
45%
66%
Secure, real-time collaborative platforms for escalation
43%
54%
Predictive analytics or modeling tools
41%
55%
Scenario modeling or stress-testing software
32%
43%
Digital twins of operations or supply chains
23%
33%
External advice is coming too late
80%
More than 80% of organizations wait until risk has escalated before accessing external support, leaving them less prepared for when a crisis inevitably hits.
real-world experience
Hear from our crisis leaders
The role has evolved, but the structures have not
Realizing the full potential of the GC
The governance structure mismatch
GCs are increasingly helping organizations assess and respond to emerging crises.
39%
perceive that in a crisis event, they add the most value in shaping how trade-offs between speed, legal defensibility and reputational impact are understood.
CEO 44%
Boards 24%
GCs 21%
Other C-suite members 11%
Responsibility for determining whether an emerging issue is formally escalated to a crisis event remains shared across leadership.
The GC – board engagement lag
With their shared mandate of risk oversight, focus on protecting long-term enterprise value, as well as a preference for early threat escalation, boards are natural strategic partners for GCs.
This presents an opportunity for more GCs to engage early with boards on crisis decision-making.
57%
of surveyed GCs proactively engage with their boards on framing crisis issues, options and possible trade-offs.
What matters when everything matters?
When both overreaction and underreaction are costly
Not every issue becomes a crisis, but every crisis starts as an issue. The challenge for GCs is knowing when to escalate, when to act, when to wait and what all the possible consequences are.
Greatest Risks of Underestimating*
External actors set the narrative before leadership does
Legal or regulatory exposure increases before action is taken
Reputational damage becomes harder to contain once the issue becomes visible
*according to GCs (top three selected among nine options)
Greatest Risks of Overestimating*
Unnecessary diversion of financial or operational resources
Reduced credibility of future warnings
Overly cautious decision-making that constrains strategic opportunities
*according to GCs (top three selected among nine options)
