rechtsrisicos

Rechtsrisiken, commonly rendered in English as legal risks, refer to potential losses or non-financial harms arising from the legal environment surrounding an entity. They cover obligations under statutory and regulatory regimes, contractual commitments, and the risk of litigation or other legal action.

In business, finance, and public administration, legal risk can affect operations, reputation, access to capital, and the license to operate.

Common categories include regulatory compliance risk, contractual risk, litigation risk, and risks related to intellectual property, data protection, tax, employment, product liability, environmental law, sanctions and export controls, and anti-money laundering.

Causes include changes in law and regulation, ambiguous or conflicting interpretations, gaps in policies or procedures, supplier or third-party failures, and inadequate due diligence or governance.

Management approaches center on identification, assessment, and prioritization of risks, followed by mitigation or transfer strategies, such as policies, training, internal controls, due diligence, third-party risk management, incident response plans, and insurance.

Governance and accountability typically rest with senior management and the board, with legal, compliance, and risk-management functions coordinating, often supported by external counsel. Legal risk is increasingly integrated into enterprise risk management through risk registers, materiality assessments, and regular reporting.