Skip to content

11 July, 2025

  • Saved Articles
  • My Account
  • Subscribe
  • Log In
  • Log Out

Board Agenda

  • Governance
  • Strategy
  • Risk
  • Ethics
  • News
  • Insight
    • Categories

      • View all
      • Governance
      • Strategy
      • Risk
      • Ethics
      • Board Expertise
      • finance
      • Technology
    • EU sustainability

      Omnibus package must not undermine EU sustainability

      Now is the time for Europe to speed up green transition, rather than slow it...

    • high pay

      Pay gap transparency needs to be better

      It’s not unknown for a CEO to earn 500 times as much the median employee,...

    • executive pay

      Executive pay trends in 2025

      Opposition to remuneration reports has grown sharply, according to Georgeson’s analysis of voting outcomes in...

  • Comment
      • View all
    • EU sustainability

      Omnibus package must not undermine EU sustainability

      Now is the time for Europe to speed up green transition, rather than slow it...

    • high pay Pay gap transparency needs to be better

      It’s not unknown for a CEO to earn 500 times as much the median employee,...

    • future-proof governance levers How to future-proof your business

      For boards to bolster resilience and create value in a polycrisis, a combination of hard...

  • Interviews
      • View All Interviews
      • Podcasts
      • Webinars
    • UK Corporate Governance Code Board meetings ‘are not up to scratch’

      Nearly three-quarters of board members believe the board’s performance in meetings needs improvement, an expert...

    • financial sanctions Tariffs chaos drives boardroom focus on resilience

      Business leaders will prioritise the resilience of their organisations in the face of economic upheaval...

    • supply chain oversight Act now on supply chain oversight, boards warned

      Board directors need to critically engage with the business’s supply chain activity, a panel of...

  • Board Careers
  • Resource Centre
      • White Paper Downloads
      • Book Reviews
      • Board Advisory & Corporate Services
    • C-suite barometer: outlook 2025 – UK insights

      Forvis Mazars draws UK insights from its global study and looks at UK executives’ strategic...

    • Talent Management 2025 Mind Gym

      Talent Management in 2025

      From rethinking leadership to wrestling with AI, MindGym's report reveals the trends shaping talent strategies...

    • Korn Ferry CHRO 2025 (Copy)

      On The Highwire: Being a CHRO in 2025

      Korn Ferry surveyed 750 senior HR leaders (including 450 CHROs) to understand their key priorities...

  • Events
  • Search by topic
    • Governance
    • Strategy
    • Risk
    • Ethics
    • Regulation
    • ESG
    • Investor Relations
    • Careers
    • Board Expertise
    • finance
    • Technology

D&O litigation on the rise amid host of emerging risks

by AIG AIG SPONSORED

Directors face liability over a range of new threats, with data breaches, executive misconduct and climate boosting D&O litigation claims.

Yellow umbrella in a crowd of black umbrellas

Image: Konstantin Faraktinov/Shutterstock

As bankruptcies mount brought on by the current crisis, so the risk of litigation against directors and officers (D&O) climbs. But it is not just the pandemic bringing potential problems to the door of company directors.

A host of issues have emerged to heighten concerns of regulators and shareholders, leaving directors with greater exposure to litigation and regulatory investigation. As the world becomes more complex, so too do the risks.

“The role of directors has become riskier,” says Nepo Loesti, head of financial lines Europe at insurance company AIG. “They are under more scrutiny and are being held accountable for their decisions, but at the same time their responsibilities have been increasing in areas like cybersecurity and privacy; compliance, such as bribery and corruption laws; and a heightened focus on corporate social responsibility.”

A new special report—Board Directors’ Guide to D&O Liability Insurance—produced by Board Agenda in partnership with AIG, highlights the trends driving D&O litigation. They include record numbers of class action lawsuits in the US, including increased numbers against non-domestic firms; increased activity originating in other countries, such as Australia, and across Europe; increased event-driven claims, such as those prompted by cyber attacks or executive misconduct; and a tougher regulatory environment.

In Europe, the report warns, the trends point towards the emergence of a claims culture, and a general desire to hold directors responsible and seek compensation.

Insolvency, cyber and societal change

Experts point to a number of risks that have raised D&O concerns. These include insolvency claims; cybersecurity and data breaches; climate change and environmental issues; the #MeToo movement and other societal risks and merger objection litigation.

While insolvency is a risk as old as business itself, other risks have emerged in recent years to test directors.

One of these is cybersecurity, which companies have previously tended to see as an operational issue rather than rooted in governance. The report warns that boards should seek external advice and regulator briefings to ensure that companies are aware of the risks posed by cyber and new technologies.

Meanwhile, environmental issues are behind a number of D&O claims, a trend that is likely to accelerate. Societal risks also continue to evolve, with increased personal accountability, changing attitudes and the rise of social media meaning that directors are increasingly exposed.

“We should expect to see more claims in the future resulting from societal change,” says Geraud Verhille, head of financial lines UK at AIG. “People are now far less willing to put up with perceived injustices and failings in corporate conduct and culture.

“They are more willing to speak up and will find the lawyers waiting should they want to bring a complaint.”

That all places a premium on directors being prepared for things going sour. There are potentially ruinous costs involved in facing claims. Regulatory investigations can go on for many years before the directors are finally exonerated. Even when directors are innocent, claims can result in large and unexpected legal bills.

Board engagement with risk has never been so important. Directors need to develop a deep understanding of their liabilities and emerging risks, and to engage—in partnership with their risk managers and legal counsel—in regular reviews of their D&O liability insurance.

Click here to download the report.

  • Facebook
  • Twitter
  • Google+
  • LinkedIn
  • Mail

Related Posts

  • Call to curb ‘superstar’ CEOs with D&O insurance
    August 16, 2023
    superstar ceo

    US states need to legislate to stop executives from insuring their own directors in the way Elon Musk did, writes law professor.

  • Cyber criminals chase ransomware insurance money
    April 18, 2023
    ransomware insurance

    Specialist ransomware criminals are investigating victims’ insurance capacity—sometimes by blatantly asking companies outright.

  • D&O insurance price rises ease after years of turbulence
    February 14, 2022
    Businesswoman with umbrella overlooking the city

    Survey by Marsh finds that D&O insurance prices rose 24% in the fourth quarter of 2021, compared with hikes of 61% in Q3 and 92% in Q2.

  • Anticipation is key to risk management and resilience
    March 10, 2023
    Irene Dorner

    Experts warn that boards cannot devise a response plan to everything that might go wrong, so should focus on emerging risks.

Search


Follow Us

Register Free

Stay in the know! Register to access the latest governance news; plus receive updates about our events and podcasts – Sign up here

 

Most Popular

Featured Resources

wef global risks 2025

The Global Risks Report 2025

The 20th edition of the Global Risks Report reveals an increasingly fractured global...
Supply chain management cover

Strategic Oversight in Supply Chain Management: A Guide for Corporate Boards 2025

Supply chains have become complex, interdependent and opaque and—according to research...
OB-Cyber-Security

Cyber Security: What Boards Need to Know

Maintaining firewalls, protecting servers and filtering malicious emails rarely make...

The IA’S Principles Of Remuneration 2024 2025

This guidance from the Investment Association is aimed at assisting remuneration...
Diligent 2024 leadership tech cover

Leadership, decision-making & the role of technology: Business survey 2024

This research report by Board Agenda and Diligent sheds light on how board directors...

Director Reference Guide: Navigating Conflict in the Boardroom

The 'Director Reference Guide' on navigating conflict in the boardroom provides practical...
Nasdaq 2024 governance report cover

Nasdaq 2024 Global Governance Pulse

This Nasdaq survey gathered data from more than 870 board members, executives, and...

Becoming a non-executive director (4th edition)

Board composition is the subject of much debate, while the role of the non-executive...
art & science brainloop new cover

The Art & Science of Creating an Effective Board

Boards are coming under more scrutiny and pressure than ever before from regulators,...
SAA First time NED guide

First Time Guide for Non-Executive Directors

The role of the non-executive director has never been more vital: to advise, support,...

Register Free

Stay in the know! Register to access the latest governance news; plus receive updates about our events and podcasts. Register


  • Editors & Contributors
  • Editorial Advisory Board
  • Board Advisory & Corporate Services
  • Media Marketing Solutions
  • Contact Us
  • About Us
  • Board Director Network
  • Terms & Conditions
  • Privacy Policy
  • Cookies
|

Copyright © 2025 Questor Media Group Ltd.

  • Terms & Conditions
  • Privacy Policy
  • Sitemap