Retaining and attracting the right talent is one of the biggest risks facing businesses in the year ahead, according to a survey of chief financial officers.
The research was carried out by Deloitte among 1,151 CFOs based in 15 countries across Europe, including Ireland.
The findings differ from the previous survey carried out earlier this year, in which the economic outlook and geopolitical risks ranked as the top two risks.
In order to attract and retain talent, 85% of the CFOs surveyed said they are rolling out flexible working patterns.
Meanwhile, 69% said they are reviewing their total reward offering, 68% are investing in wellbeing and assistance programmes, and 59% are investing in sustainability initiatives - such as measures to reduce their carbon footprint.
Today's report also reveals that just 32% of CFOs are forecasting an increase in revenue over the next 12 months - down from 61% six months ago.
However, Irish CFOs expect less economic and financial uncertainty than their European counterparts.
When it comes to inflation, the majority of CFOs in Ireland expect rates to remain over 8% for the next year.
Today's report shows that CFOs are reviewing strategies to mitigate the risk, with 93% set to increase energy efficiency or reduce use, 85% to pass on costs to customers and 56% to reduce staff costs, including hours or headcount.
"As inflation rates remain higher for longer, the means for CFOs to absorb costs on top of additional costs will become more challenging", said Daniel Gaffney, Partner at Deloitte Ireland.
"In turn, with the cost of debt rising and risk appetite waning, organic growth has become more of a focus over M&A activity.
"While this may be the right decision in the shorter term, CFOs need to look at longer term investments to mitigate risks as inflation sustains. M&A activity and continuing to invest in digital technologies may be essential to survive in the longer term," he added.
While 59% of companies believe investing in sustainability initiatives may help address their biggest risk of attracting and retaining talent, just 37% of CFOs noted climate change as a risk to their business in the next 12 months.
"We know many companies are grappling with sustainability reporting with investors placing increasing focus on company disclosures," said Mike Hartwell, Head of Audit and Assurance at Deloitte Ireland.
"While the economic environment remains uncertain, the climate crisis is existential, and companies have a vital role to play in mitigating the risks," he said.
"This includes investing in technology and reviewing their own business practices but also ensuring transparent disclosure on the risk of climate change to a business's bottom line," he added.
