Corporate Governance and the Management of HR Risks in German listed companies: Selected Insights

<ns3:p>HR risks are an essential part of strategy development and execution that have come under ever-sharper focus in recent years, especially as labour shortages and digital transformation trends bring new challenges for management and their workforces. Thus, information on the prevalence and severity of HR risks is essential for a sound debate on strategy and its consequences as part of supervisory boards. Evidence from existing studies shows that HR risks are attracting less attention than other risks, such as financial risks. This discrepancy is in part attributable to the scarcity of empirical evidence on the prevalence of HR risks. This study was therefore conducted on the state of HR risk management as perceived by supervisory board members in Germany; via interviews and a survey, they were asked for their views on the quality of information on HR risks as well as the prevalence of certain HR risk areas. It was found that the participating supervisory board members are not fully satisfied with the information they receive and that motivation and engagement may be the most urgent risks to address. Given the finding that satisfaction with the information on HR risks is significantly positively related to the general quality of cooperation on the supervisory board, this further emphasises the importance of HR risk information for an effective risk governance by the supervisory board.</ns3:p>