Several factors can contribute to litigation risk, including:
- Regulatory Compliance: Failing to comply with laws and regulations can lead to legal action. Business leaders must ensure that the company adheres to all relevant laws. - Contractual Disputes: Misunderstandings or breaches of contract can result in lawsuits. Effective contract management practices are essential. - Employment Issues: Disputes related to employment practices, such as wrongful termination or discrimination, can lead to litigation. - Intellectual Property: Infringement on intellectual property rights can result in costly legal battles.