GCs at global companies are less pessimistic about the business impact of the coronavirus pandemic allowing concerns over privacy to move up their agendas, according to a Morrison & Foerster survey.

As government-imposed lockdowns lift and economies start to reopen, the number of companies rating the business impact of Covid-19 as severe dropped to 42% at the end of May, 10 percentage points lower than when the firm last ran the survey in March.

Even so, companies believe a full or near recovery is still many months away, the Covid-19 Business Impact Survey of more than 100 global GCs shows.

David Newman, a partner and head of MoFo’s coronavirus taskforce, said: “The survey underscores that the pandemic continues to have a dramatic and disruptive impact on companies and legal departments — and that significant disruption is expected to remain the norm for at least the next two years.”

Perceptions of risk around privacy and data security have also increased in the two months since the first survey was taken. Privacy is now considered the third-biggest Covid-19 risk for companies, with 59% ranking it as their top risk — up from 18% in March. Data security was ranked fourth with 50%, also up from 18%. The top two risks remained employment/human resources (87%) and contracts (64%). 

Miriam Wugmeister, partner and co-chair of MoFo’s privacy and data security practice, said: “With the vast majority of large company employees working remotely during the Covid-19 pandemic, we’ve seen a significant increase in cyberattacks, phishing attempts and scams that have occurred. Hackers and bad actors are capitalising on the fear of the moment and the widespread use of unsecured wireless networks by unassuming employees.”

Business leaders are also concerned about the threat of subsequent lockdowns, with around two-thirds of GCs saying it is a moderate to extreme concern. Roughly three in five companies say their second biggest concern in relation to lockdown is conflicting government guidance.

Newman added: “These findings are consistent with what we’re hearing in our conversations with our clients. The challenge now will be understanding what the next phase of the pandemic will look like. But having just lived through the first stage of the virus, companies now have some insight into the challenges and issues involved in operating at a time of stay-at-home orders and with a persistent risk of infection.”

Further reading on the Covid-19 pandemic

Law firms will be judged on how they behaved during the pandemic — Practices that communicated well and contributed to the Covid-19 'battle' will reap future rewards, argues Kerry Jack

After Covid-19, client tensions that pre-existed the pandemic will become intolerable — Law firms banking on a return to the old way of doing business once the immediate crisis is over are doomed, argues Rob Millard

Under lockdown socialising between international colleagues has increased — Colin Passmore outlines the measures Simmons & Simmons has been taking to promote staff wellbeing during the Covid-19 crisis

Above all, this crisis too will pass — Rob Millard foresees large law firm mergers and accelerated digitisation in the wake of Covid-19

'It is about being proactive and decisive' — Norton Rose Fulbright EMEA managing partner Peter Scott on the thinking behind the firm's flexible working scheme

'Now is the time for law firms to deliver on their stated values' — Consultant Tony Williams advises law firm leaders to avoid knee jerk decisions and go into communication overdrive during the Covid-19 crisis