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Item 1A. Risk Factors

2023-02-28 compared with 2022-02-28 · 107 added, 180 removed, 224 unchanged (56% of the section changed)

In addition to the other information set forth in this report, you should carefully consider the following risks that based upon current knowledge, information and assumptions could materially adversely affect our business, financial condition and results of operations.

Some of these risks and uncertainties could affect particular service lines or geographies, while others could affect all of our businesses.

In addition to other information set forth in this report, you should carefully consider the following risks that based upon current knowledge, information and assumptions could materially adversely affect our business, financial condition and results of operations.

Some of these risks and uncertainties could affect particular segments or geographies, while others could affect all of our businesses.

Although each risk is discussed separately, many are interrelated.

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Our business is also subject to general risks and uncertainties which broadly affect all companies.

General Overview .

Our business environment is complex, dynamic and international.

Accordingly, it is subject to a number of significant risks in the ordinary course of its operations.

If we cannot or do not successfully manage the risks associated with the services we provide, our operations, business, operating results, reputation and/or financial condition could be materially and adversely affected.

One of the challenges of a global business such as ours is to determine in a sophisticated manner the critical enterprise risks that exist or may newly develop over time as our business evolves.

We must then determine how best to employ reasonably available resources to prevent, mitigate and/or minimize those risks we identify as having the greatest potential to cause significant damage from an operational, financial, or reputational standpoint.

Our Board and its Committees take active roles in overseeing management's identification, disclosure and mitigation of enterprise risks.

Our ongoing enterprise risk management efforts have significantly shaped the following risk factors and their discussion.

Categorization of Enterprise Risks .

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• Strategic Risk Factors • General Risk Factors

• Legal and Compliance Risk Factors

We could appropriately place some of the risks we identify in more than one category, but we have chosen the one category we view as primary.

• Legal, Compliance and Regulatory Risk Factors

Although risks we identify may fit the criteria of more than one category, we chose the category we view as primary.

We do not present the risks below in their order of significance, the relative likelihood we will experience a loss, or the magnitude of any such loss.

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and other risks, including human resources and reputation.

REPUTATIONAL AND BRAND RISKS.

The value and premium status of our brand is one of our most important assets.

An inherent risk in maintaining our brand is that we may fail to successfully differentiate the scope and quality of our service and product offerings from those of our competitors, or that we may fail to sufficiently innovate or develop improved products or services that will be attractive to our clients.

The rapid dissemination and increasing transparency of information, particularly for public companies, increases the risks to our business that could result from negative media or announcements about ethics lapses or other operational problems, which could lead clients to terminate or reduce their relationships with us.

As such, any negative media, allegations or litigation against us, irrespective of the final outcome, could potentially harm our professional reputation and damage our business.

We are also subject to misappropriation of one of the names or trademarks we own by third parties that do not have the right to use them so they can benefit from the goodwill we have built up in our intellectual property;

further, our efforts to police usage of our intellectual property may not be successful in all situations.

COMPETITION FOR TALENT WORLD-WIDE;

EMPLOYEE RETENTION;

DIVERSITY, EQUITY AND INCLUSION INITIATIVES;

SUCCESSION OF KEY LEADERS.

INSUFFICIENT ORGANIZATIONAL AGILITY ACROSS OUR STRATEGY, STRUCTURE, PROCESSES, PEOPLE AND TECHNOLOGY MAY IMPACT OUR COMPANY’S SUCCESS.

Our business is evolving at a rapid pace.

Our organizational agility underpins our ability to mitigate many other risks, minimize impacts from adverse events, and capitalize upon opportunities when presented.

The sheer size of our company - with over 103,000 employees across more than 80 countries - makes change-management and responsiveness challenging.

Any global change is a complex undertaking as we are required to comply with the numerous and often contradictory local regulatory environments while achieving the objective of the change.

Lack of responsiveness in a timely fashion could result in negative financial impact and reputational damage.

WE MAY NOT BE ABLE TO RETAIN OUR SENIOR MANAGEMENT, ATTRACT AND RETAIN QUALIFIED AND EXPERIENCED EMPLOYEES, AND DELIVER ON OUR DIVERSITY, EQUITY AND INCLUSION STRATEGY.

We depend, in large part, on the members of our senior management team who possess extensive knowledge and a deep understanding of our business and strategy, as well as the colleagues who are critical to developing and retaining client relationships.

Our business depends on the continued availability of skilled personnel with industry experience and knowledge, including our senior management team and other key employees.

Our success depends on the continued availability of skilled personnel with industry experience and knowledge, and our ability to recruit, attract and retain senior management and other key employees, including through the implementation of diversity, equity and inclusion initiatives, and the succession of senior management.

We are working to advance culture change through the continued implementation of diversity, equity and inclusion initiatives throughout our organization.

If we do not (or are perceived not to) successfully implement these initiatives, our ability to recruit, attract and retain talent may be adversely impacted.

We are working to advance culture change through the continued implementation of diversity, equity and inclusion (“DEI”) initiatives throughout our organization.

If we do not (or are perceived not to) successfully implement these initiatives, our ability to recruit, attract and retain talent may be adversely impacted and shifts in perspective and expectations about social issues and priorities surrounding DEI may occur at a faster pace than we our capable of managing effectively.

The possibility that we are unable to identify, attract and retain sufficient talent in key positions, may prevent us from achieving our strategic vision, disrupt our business, impact revenues, increase costs, damage staff morale, and affect the quality and continuity of client service.

A lack of ready-now or future successors for key roles also may negatively impact our business in a variety of ways.

There is a further risk of losing talent (and intellectual property and client contacts) to competitors, particularly in the context of increased use of social media networks and transparency of employment information.

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Corporate payrolls are likely to increase as greater competition for labor and social pressure to raise salaries in line with productivity growth cause even greater wage inflation.

It is increasingly challenging to predict regional and national labor policies, as well as regulations.

The indirect implications of these changes are difficult to assess.

THIRD PARTY SPEND MANAGEMENT AND HEALTH AND SAFETY RISK.

Regional and national labor policies are difficult to predict and the indirect implications of changes to them are difficult to assess.

OUR RELIANCE ON THIRD PARTIES COULD EXPOSE US TO INCREASED ECONOMIC AND REPUTATIONAL HARM.

We rely on third parties, and in some cases subcontractors, to perform activities on behalf of our organization to improve quality, increase efficiencies, reduce costs and lower operational risks across our business and support functions.

We have instituted a Vendor Code of Conduct, which is published in multiple languages on our website, and which is intended to communicate to our vendors the standards of conduct we expect them to uphold.

We continue to use a Vendor Code of Conduct, which is published in multiple languages on our website, intended to communicate to our vendors the standards of conduct we expect them to uphold.

Our contracts with vendors also generally impose a contractual obligation to comply with our Vendor Code.

In addition, we leverage technology at an increasing rate to help us better screen vendors, with the aim of gaining a deeper understanding of the risks posed to our business by potential and existing vendors.

If our third parties do not have the proper safeguards and controls in place, or appropriate oversight cannot be provided, we could be exposed to increased operational, regulatory, financial or reputational risks.

A failure by third parties to comply with service level agreements or regulatory or legal requirements in a high quality and timely manner, particularly during periods of peak demand for their services, could result in economic and reputational harm to us.

If our third parties do not have the proper safeguards and controls in place, or if appropriate oversight cannot be provided, or if they fail to comply with service level agreements or regulatory or legal requirements in a high quality and timely manner, we could be exposed to increased operational, regulatory, financial or reputational risks.

In addition, these third parties face their own technology, operating, business and economic risks, and any significant failures by them, including the improper use or disclosure of our confidential client, employee or company information, could cause damage to our reputation and harm to our business.

Our contractors and their subcontractors are more integrated into our operations than ever before and, as a result, also involved in a significant proportion of the safety incidents we experience.

Health and safety is a prominent part of our Beyond strategy, so we take steps to engage with our supply chain and improve our safety performance.

This includes producing a dedicated Global Health and Safety Report detailing our approach to managing this important topic.

OUR HEALTH, SAFETY, SECURITY AND ENVIRONMENT PROGRAM, POLICIES, AND PROCEDURES (INCLUDING THOSE OF OUR CONTRACTORS AND SUBCONTRACTORS) MAY NOT BE ADEQUATE.

Health, safety and security is a prominent part of our Beyond strategy, which is why we have taken steps to implement what we believe are strong operational health and safety controls.

Our goal is to ensure those we work and interact with are unharmed by our operations.

We have a multi-disciplinary safety management structure, with executive sponsorship, aimed at managing existing and emerging health and safety risks, and achieving continuous improvement.

However, despite investment in our safety platform, management systems and vendor due diligence program, additional efforts are necessary to ensure vendors are aware of our high health and safety expectations.

WE FACE BUSINESS DISRUPTION AND RELATED RISKS RESULTING FROM HEALTH EPIDEMICS, ESPECIALLY THE NOVEL CORONAVIRUS (COVID-19) PANDEMIC.

However, despite significant investments in our safety platform, management systems and vendor due diligence program, if our health and safety policies, procedures, and programs are not adequate, or if our employees or contractors do not receive or complete adequate training or comply with our policies and procedures, we may be exposed to significant consequences including serious injury or loss of life, which could have a material impact on our financial performance and reputation.

In addition, our contractors and their subcontractors are highly integrated into many aspects of our operations and therefore are involved in a significant proportion of the safety incidents we experience.

Additional efforts are necessary to ensure our vendors are aware of our high health and safety expectations and consistently comply with our policies and procedures.

WE FACE BUSINESS DISRUPTION AND RELATED RISKS RESULTING FROM HEALTH EPIDEMICS, INCLUDING THE COVID-19 PANDEMIC.

Health epidemics that affect the general conduct of business in one or more urban areas (including as the result of travel restrictions and the inability to conduct face-to-face meetings) have occurred in the past, for example from influenza or COVID-19, and may occur in the future from other types of outbreak.

Such instances can adversely affect the volume of business transactions, real estate markets and the cost of operating real estate or providing real estate services.

At present, efforts to contain and mitigate the COVID-19 pandemic are still occurring in many countries where we operate, including the United States.

This year saw an increasing percentage of the global population receive a COVID-19 vaccine, but access and availability to COVID-19 vaccines and tests varies across geographies.

New COVID-19 variants continue to emerge which, at times, has resulted in significant spikes in the number of local, regional, and global cases, and uncertainties exist as to the efficacy of vaccines against new variants or mutations of COVID-19.

To mitigate the spread of COVID-19, local, state, and federal governments have imposed various restrictions on businesses, including closures, travel restrictions, vaccine and testing mandates, among other requirements.

While the increased availability of vaccines and vaccination rates gave rise to increased optimism in 2021, the pandemic continued to have a material effect on our financial results in 2021, although less pronounced of an impact on our financial results when compared against the prior year.

Although there has been an easing of restrictions in certain jurisdictions, some of these restrictions have been reinstated in other jurisdictions, or could be reinstated in the future, to manage a resurgence or new outbreak of COVID-19, including in connection with new variants or mutations of the virus.

In addition, the reopening of businesses and economies in certain countries is creating a variety of new challenges, including, for example, higher prices for goods and services, limited availability of products, and disruptions to supply chains.

Furthermore, our management team has spent, and will likely continue to spend, significant time, attention and resources monitoring the COVID-19 pandemic and seeking to manage its effects on our business and workforce.

A long-term continuation of these restrictions could, among other things, negatively impact employee morale and productivity.

Significant uncertainty remains as to the full impact of the COVID-19 pandemic on our operations, and on the global economy as a whole, including potential short-term and long-term changes in commercial behavior.

It is currently not possible to predict how long the pandemic will last or the time that it will take for economic activity to fully return to pre-pandemic levels.

We expect the ultimate significance of the impact of these disruptions, including the extent of their adverse impact on our financial and operational results, will be dictated by the length of time that such disruptions continue, which will, in turn, depend on the currently unknowable duration of the COVID-19 pandemic and the impact of governmental regulations that might be imposed in response.

COVID-19 also makes it more challenging for management to estimate future performance of our businesses, particularly over the near to medium term.

TECHNOLOGY AND INFORMATION SYSTEMS;

CYBERSECURITY, MANAGEMENT OF DATA.

At present, efforts to contain and mitigate the COVID-19 pandemic are still occurring in many countries where we operate.

For example, during 2022, China had various COVID-19 related restrictions in place.

New COVID-19 variants could continue to emerge which may result in continued significant spikes in the number of local, regional, and global cases, and uncertainties as to mitigations that local, state, and federal governments will impose, including closures, travel restrictions, vaccine and testing mandates, among other requirements.

DISRUPTIONS IN COMPUTER SYSTEMS, OR PRIVACY BREACHES OR CYBERSECURITY ISSUES, COULD IMPACT OUR ABILITY TO SERVICE OUR CUSTOMERS AND ADVERSELY AFFECT OUR BUSINESS, DAMAGE OUR REPUTATION AND EXPOSE US TO FINANCIAL RISK.

Our business is highly dependent on our ability to collect, use, store and manage organizational and client data.

If any of our information and data management systems do not operate properly or are disabled, we could suffer a disruption of our businesses, liability to clients, loss of client data, loss of employee data, regulatory intervention, breach of confidentiality or other contract provisions, or reputational damage.

These systems may fail to operate properly or become disabled as a result of events wholly or partially beyond our control, including disruptions of electrical or communications services, disruptions caused by natural disasters, political instability, terrorist attacks, sabotage, computer viruses, or problems with the internet, deliberate attempts to disrupt our computer systems through "hacking," "phishing," or other forms of cyber-attack, or our inability to occupy one or more of our office locations.

If any of our information and data management systems do not operate properly or are disabled, we could suffer a disruption of our businesses, liability to clients, loss of client or other sensitive data, loss of employee data, regulatory intervention, breach of confidentiality or other contract provisions, or reputational damage.

These systems may fail to operate properly or become disabled as a result of events wholly or partially beyond our control, including disruptions of electrical or communications services, as well as disruptions caused by natural disasters, political instability, terrorist attacks, sabotage, computer viruses, deliberate attempts to disrupt our computer systems through "hacking," "phishing," or other forms of both deliberate or unintentional cyber-attack, or our inability to occupy one or more of our office locations.

As we outsource significant portions of our information technology functions to third-party providers, such as cloud computing, we bear the risk of having somewhat less direct control over the manner and quality of performance.

We are exposed to the risk of cyber-attacks in the normal course of business.

In general, cyber incidents can result from deliberate attacks or unintentional events.

We continue to observe an increased level of cyber threats focused on gaining unauthorized access to digital systems for purposes of misappropriating assets or sensitive information, corrupting data, or causing operational disruption.

Cyber threats are proliferating and advancing their ability to identify and exploit vulnerabilities, requiring continuous evaluation and improvements to our security architecture and cyber defenses.

The risk of cyber threats also extends to suppliers and vendors we engage on a principal basis to perform various services.

Additionally, like many large enterprises, since 2020, a portion of our workforce has worked remotely in some capacity in response to the COVID-19 pandemic.

This arrangement introduces potential new vulnerabilities to cyber threats.

We also face increased cybersecurity risk as we deploy additional mobile and cloud technologies.

We are continuously hardening our infrastructure built on these technologies, monitoring for threats, and evaluating our capability to respond to any incidents to minimize any impact to our systems, data, or business operations.

We have experienced various types of cyber-attack incidents, which to-date have been contained and have not been material to us as a whole.

As the result of such incidents, we have continued to implement new controls, governance, technical protections and other procedures.

We have experienced various types of cyber-attack incidents which to-date have been contained and not material to us.

As the result of such incidents, we continue to implement new controls, governance, technical protections and other procedures.

We may incur substantial costs and suffer other negative consequences such as liability, reputational harm and significant remediation costs and experience material harm to our business and financial results if we, or vendors or suppliers we engage on behalf of our clients, fall victim to other successful cyber-attacks.

The legislative and regulatory framework for privacy and data protection issues worldwide continues to evolve.

We collect personally identifiable information ("PII") and other data as part of our business processes and activities.

In addition, we collect personally identifiable information ("PII") and other data as part of our business processes and activities.

This data is subject to a variety of U.S.

and foreign laws and regulations, including oversight by various regulatory or other governmental bodies.

Many foreign countries and governmental bodies have laws and regulations concerning the collection and use of PII and other data obtained from their residents or by businesses operating within their jurisdictions.

The European Union General Data Protection Regulation, for example, imposes stringent data protection requirements and provides significant penalties for noncompliance.

Any inability, or perceived inability, to adequately address privacy and data protection concerns, even if unfounded, or comply with applicable laws, regulations, policies, industry standards, contractual obligations, or other legal obligations (including at newly acquired companies) could result in additional cost and liability to us or company officials, damage our reputation, inhibit sales, and otherwise adversely affect our business.

Any inability, or perceived inability, to adequately address data privacy and data protection concerns, even if unfounded, or comply with applicable laws, regulations, policies, industry standards, contractual obligations, or other legal obligations (including at newly acquired companies) could result in additional cost and liability to us or company officials, damage our reputation, inhibit sales, and otherwise adversely affect our business.

CONCENTRATIONS OF BUSINESS WITH CORPORATE AND INVESTOR CLIENTS CAUSE INCREASED CREDIT RISK AND GREATER IMPACT FROM THE LOSS OF CERTAIN CLIENTS AND INCREASED RISKS FROM HIGHER LIMITATIONS OF LIABILITY IN CONTRACTS.

We value the expansion of business relationships with individual corporate clients and institutional investors because of the increased efficiency and economics (both to our clients and us) that can result from developing repeat business and performing an increasingly broad range of services for the same client.

Having increasingly large and concentrated clients also can lead to greater or more concentrated risks of loss if, among other possibilities, such a client (i) experiences its own financial problems, which can lead to larger individual credit risks;

Having increasingly large and concentrated clients can lead to greater or more concentrated risks of loss if, among other possibilities, such a client (i) experiences its own financial problems, which can lead to larger individual credit risks;

(ii) becomes bankrupt or insolvent, which can lead to our failure to be paid for services we have previously provided or funds we have previously advanced;

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Where competitive pressures result in higher levels of potential liability under our contracts, the cost of operational errors and other activities for which we have indemnified our clients will be greater and may not be fully insured.

PERFORMANCE AND FIDUCIARY OBLIGATIONS UNDER CLIENT CONTRACTS;

RISING COST OF INSURANCE RESULTING FROM NEGLIGENCE CLAIMS;

RESPONSIBILITY FOR SAFETY OF CONTRACTORS;

WE ARE EXPOSED TO LEGAL AND REPUTATIONAL RISKS ARISING FROM BREACH OF FIDUCIARY OBLIGATIONS CLAIMS PURSUANT TO CLIENT CONTRACTS.

In certain cases, we are subject to fiduciary obligations to our clients, which may result in a higher level of legal obligation compared to basic contractual obligations.

These relate to, among other matters, the decisions we make on behalf of a client with respect to managing assets on its behalf or purchasing products or services from third parties or other divisions within our Company.

Our services may involve handling substantial amounts of client funds in connection with managing their properties or complicated and high-profile transactions.

These relate to, among other matters, the decisions we make on behalf of a client with respect to managing assets on its behalf, purchasing products or services from third parties or other divisions within our Company, or handling substantial amounts of client funds in connection with managing their properties or complicated and high-profile transactions.

We face legal and reputational risks in the event we do not perform, or are perceived to have not performed, under those contracts or in accordance with those obligations, or in the event we are negligent in the handling of client funds or in the way in which we have delivered our professional services.

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Any increased or unexpected costs or unanticipated delays in connection with the performance of these engagements, including delays caused by factors outside our control, could have an adverse effect on profit margins.

If we perform services for clients beyond, or different from, what were originally contemplated in the governing contracts (known as "scope creep"), we may not be fully reimbursed for the services provided, realize our full compensation potential or our potential liability in the case of a negligence claim may not have been as limited as it normally would have been or may be unclear.

CORPORATE CONFLICTS OF INTEREST.

All providers of professional services to clients, including our Company, must manage potential conflicts of interest.

This occurs principally where the primary duty of loyalty we owe to one client may potentially be weakened or compromised by a relationship we also maintain with another client or third party.

WE ARE SUBJECT TO ACTUAL OR PERCEIVED CORPORATE CONFLICTS OF INTEREST CLAIMS.

Corporate conflicts of interest arise in the context of the services we provide as a company to our different clients.

Personal conflicts of interest on the part of our employees are separately considered as issues within the context of our Code of Business Ethics.

Personal conflicts of interest on the part of our employees are separately considered as issues within the context of our Code of Ethics.

Our failure or inability to identify, disclose and resolve potential conflicts of interest in a significant situation could have a material adverse effect.

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and other risks, including the demand for our services, competitive threats, technology and innovation, and public policy.

DISRUPTIVE TECHNOLOGIES, INNOVATION AND COMPETITION.

WE MAY NOT ADEQUATELY ADAPT TO DISRUPTIVE TECHNOLOGIES, INNOVATION AND COMPETITION.

Mobile technologies and online collaboration tools are transforming how business gets done.

Information technology has entered a “big data” era.

The evolution of digital and information technology presents significant challenges for businesses and societies, which must find ways to capture the benefits of new technologies while dealing with the new threats those technologies present.

Within the real estate services industry, managing big data is a critical competitive differentiator and we risk being surpassed if our peers leverage big data more effectively.

ABILITY TO PROTECT INTELLECTUAL PROPERTY;

INFRINGEMENT OF THIRD-PARTY INTELLECTUAL PROPERTY RIGHTS.

If we are unable to provide services that address clients’ needs as well as compete with our competitors’ services, or to align our pricing, licensing and delivery models with client preferences, we could lose clients and/or fail to attract new clients, which could cause us to lose revenue and market share.

IF WE FAIL TO PROTECT OUR INTELLECTUAL PROPERTY ADEQUATELY OR INFRINGE UPON THIRD-PARTY INTELLECTUAL PROPERTY RIGHTS, OUR BUSINESS COULD BE MATERIALLY IMPACTED.

Our business depends, in part, on our ability to identify and protect proprietary information and other intellectual property such as our service marks, domain names, client lists and information, business methods and technology innovations, and platforms we may create or acquire.

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We cannot be sure the intellectual property we may use in the course of operating our business or the services we offer to clients do not infringe on the rights of third parties.

Although, we do obtain representations and warranties, as well as indemnities, from the licensors in order to mitigate this risk.

However, we do obtain representations and warranties, as well as indemnities, from the licensors in order to mitigate this risk.

We may have infringement claims asserted against us or against our clients.

These claims may harm our reputation, cost us money and prevent us from offering some services.

GENERAL ECONOMIC CONDITIONS AND REAL ESTATE MARKET CONDITIONS;

SUPPLY-CHAIN PRESSURES

The success of our business is significantly related to general economic conditions.

Further, our business and financial conditions correlate strongly to local, national and regional economic and political conditions or, at least, the perceptions of and confidence in those conditions.

We have previously experienced and expect in the future that we will be negatively impacted by periods of economic slowdown or recession and corresponding declines in the demand for real estate and related services.

The global economic crisis during the 2007-2009 period was extraordinary for its worldwide scope, severity and impact on major financial institutions, as well as for the extent of governmental stimulus and regulatory responses.

Since then, many of our markets have been affected generally by various economic uncertainties, among them:

continued significant volatility in energy costs, including oil and commodity prices;

the developing effects of climate change and severe weather;

and the continued uncertainty on the direction of global tax policy.

Most recently, we have continued to assess the potential adverse effects of the ongoing global COVID-19 pandemic on general economic conditions and increased supply-chain pressures which have emerged and may impact our ability to deliver goods and services to our clients.

In this environment, we have continued to grow our business largely by gaining market share and as the result of targeted acquisitions.

It is inherently difficult for us to predict how these types of significant global forces will affect our business in the future and whether we will continue to be able to generate revenue growth to the same extent as we have in the past.

Negative economic conditions and declines in demand for real estate and related services in several markets or in significant markets could have a material adverse effect on our performance driven by (i) a decline in acquisition and disposition activity, (ii) a decline in real estate values and performance, leasing activity and rental rates, (iii) a decline in value of real estate securities, (iv) the cyclicality in the real estate markets;

lag in recovery relative to broader markets, or (v) the effect of changes in non-real estate markets.

POLITICAL AND ECONOMIC INSTABILITY AND TRANSPARENCY:

PROTECTIONISM;

TERRORIST ACTIVITIES.

POLITICAL AND ECONOMIC INSTABILITY COULD ADVERSELY AFFECT OUR BUSINESS.

Global events could affect our business.

These include the possibility of protectionist economic policies of the United States or foreign governments, the escalation of terrorist attacks and their increasing unpredictability, health epidemics, changing immigration policies of the United States or foreign governments and the increasing globalization of our multinational clients, which creates pressure to further expand our own geographical reach into less developed countries.

We provide services in over 80 countries with varying degrees of political and economic stability and transparency.

For example, within the past few years, certain emerging as well as mature countries in which we operate have experienced serious political and economic instability that will likely continue to arise from time to time.

For example, certain emerging as well as mature countries in which we operate have experienced serious political and economic instability, such as the current geopolitical conflict involving Russia and Ukraine, that will likely continue to arise from time to time.

In recent years there have been significant political changes in several countries where we have significant operations, resulting in changes to financial, tax, tariffs, healthcare, governance, immigration and other laws that may directly affect our business and continue to evolve.

The withdrawal of the United Kingdom from the European Union on January 31, 2020 (Brexit) and the ongoing uncertainty with respect to the future relationship of the United Kingdom and the European Union, notwithstanding the impact of the provisional free-trade agreement entered into between the United Kingdom and the European Union on December 24, 2020, may adversely affect business activity, political stability and economic conditions in the United Kingdom, the European Union and elsewhere.

The economic conditions and outlook could be further adversely affected by (i) new or modified trading arrangements between the United Kingdom and other countries, (ii) the risk that one or more other European Union countries could come under increasing pressure to leave the European Union, or (iii) the risk the euro as the single currency of the Eurozone could cease to exist.

Any of these developments, or the perception any of these developments are likely to occur, could significantly affect economic growth or business activity in the United Kingdom or the European Union, and could result in the relocation of businesses, cause business interruptions, lead to economic recession or depression, and impact the stability of the financial markets, availability of credit, currency exchange rates, interest rates, financial institutions, and political, financial and monetary systems.

Any of these developments could affect our businesses, liquidity, results of operations and financial position.

REAL ESTATE SERVICES AND INVESTMENT MANAGEMENT MARKETS ARE HIGHLY COMPETITIVE.

We provide a broad range of commercial real estate and investment management services.

Depending on the service, we may face significant competition from other real estate service providers, institutional lenders, insurance companies, investment banking firms, investment managers, accounting firms, technology firms, consulting firms, co-locating providers, temporary space providers and firms providing outsourcing of various types (including technology and building products), any of which may be a global, regional or local firm, and from firms that self-perform their real estate services with in-house capabilities.

Many of our competitors are local or regional firms, which may be substantially smaller in size than we are but hold a larger share of a specific local market.

REAL ESTATE SERVICES AND INVESTMENT MANAGEMENT MARKETS ARE HIGHLY COMPETITIVE, WHICH COULD MAKE IT DIFFICULT FOR US TO MAINTAIN OUR MARKET SHARE, GROWTH RATE AND PROFITABILITY.

We face significant competition from other real estate service providers, institutional lenders, insurance companies, investment banking firms, investment managers, accounting firms, technology firms, consulting firms, co-locating providers, temporary space providers and firms providing outsourcing of various types (including technology and building products), any of which may be a global, regional or local firm, and from firms that self-perform their real estate services with in-house capabilities.

Many of our competitors are local or regional firms, which may be substantially smaller in size than us but hold a larger share of a specific local market.

Some of our competitors have expanded the services they offer in an attempt to gain additional business.

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Considering the continuing need to provide clients with more comprehensive services on a more productive and cost-efficient basis, we expect acquisition opportunities to continue to emerge.

However, there is no assurance we will be able to continue our acquisition activity in the

future at the same pace as we have in the past, particularly as we weigh acquisition opportunities against other potential uses of capital for technology and other investments in systems and human resources, as well as returning capital to shareholders.

Various factors may in some cases lead to a willingness on the part of a competitor to engage in aggressive pricing, advertising or hiring practices in order to maintain market share or client relationships.

To the extent this occurs, it increases the competitive risks and the fee and compensation pressures we face, although ramifications will differ from one competitor to another given their different positions within the marketplace and their different financial situations.

We are substantially dependent on long-term client relationships and on revenue received for services under various service agreements.

However, there is no assurance we will be able to continue our acquisition activity in the future at the same pace as we have in the past, particularly as we weigh acquisition opportunities against other potential uses of capital for technology and other investments in systems and human resources, as well as returning capital to shareholders.

We are also dependent on long-term client relationships and revenue received for services under various service agreements.

In this competitive market, if we are unable to maintain these relationships or are otherwise unable to retain existing clients and develop new clients, our business, results of operations and/or financial condition may be materially adversely affected.

Weaknesses in the markets in which they themselves compete may lead to additional pricing pressure from clients as they themselves came under financial pressure.

THE SEASONALITY OF OUR REAL ESTATE SERVICES BUSINESS EXPOSES US TO RISKS.

Within our Real Estate Services business, our revenue and profits have historically grown progressively by quarter throughout the year mostly due to completing or documenting transactions by fiscal year-end and the fact that certain of our expenses are constant through the year.

THE SEASONALITY IN PARTS OF OUR BUSINESS EXPOSES US TO RISKS.

In parts of our business, our revenue and profits have historically grown progressively by quarter throughout the year mostly due to completing or documenting transactions by fiscal year-end and the fact that certain of our expenses are constant through the year.

Historically, we have reported a relatively smaller profit in the first quarter and then increasingly larger profits during each of the following three quarters, excluding the recognition of investment-generated performance fees and co-investment equity gains or losses, each of which can vary from period to period.

The seasonality of our business makes it difficult to determine during the course of the year whether planned results will be achieved, and thus to budget, and to adjust to changes in expectations.

The seasonality of these parts of our business makes it difficult to determine during the course of the year whether planned results will be achieved, and thus to budget, and to adjust to changes in expectations.

In addition, negative economic or other conditions that arise at a time when they impact performance in the fourth quarter, such as the particular timing of when larger transactions close or changes in the value of the U.S.

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To the extent we are not able to identify and adjust for changes in expectations, or we are confronted with negative conditions that disproportionately impact the fourth quarter of a calendar year, we could experience a material adverse effect on our financial performance.

Growth in our property management and integrated facilities management businesses and other services related to the growth of outsourcing of corporate real estate services has, to an extent, lessened the seasonality in our revenue and profits during the past several years, partially offset by certain acquisitions of heavily-weighted transaction-based companies, most notably HFF, Inc.

While the ongoing effects of COVID-19 continued to impact the historic seasonality of our business into 2021, though to a lesser extent than it did in 2020, we believe some level of seasonality will always be inherent to our industry and outside of our control.

RISKS INHERENT IN MAKING ACQUISITIONS AND ENTERING INTO JOINT VENTURES.

WE ARE SUBJECT TO RISKS INHERENT IN MAKING ACQUISITIONS AND ENTERING INTO JOINT VENTURES.

Historically, a significant component of our growth has been generated by acquisitions.

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If a joint venture participant acts contrary to our interests, it could harm our brand, business, results of operations and financial condition.

INVESTMENT (INCLUDING CO-INVESTMENT) AND REAL ESTATE INVESTMENT BANKING ACTIVITIES.

WE ARE SUBJECT TO RISKS INHERENT TO INVESTMENT (INCLUDING CO-INVESTMENT) AND REAL ESTATE INVESTMENT BANKING ACTIVITIES.

An important part of our business strategy includes investing in (i) real estate, both individually and along with our investment management clients, and (ii) proptech funds and early-stage proptech companies.

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Sponsoring funds into which retail investors can invest, such as the investment funds sponsored by LaSalle, may increase this risk.

Legal and Compliance Risk Factors

Legal, Compliance and Regulatory Risk Factors

Legal and compliance risk relates to risks arising from the government and regulatory environment and action, and legal proceedings and compliance with integrity policies and procedures.

Government and regulatory risks include the risk that government or regulatory actions will impose additional cost on us or cause us to have to change our business models or practices.

BURDEN OF COMPLYING WITH MULTIPLE AND POTENTIALLY CONFLICTING LAWS AND REGULATIONS AND DEALING WITH CHANGES IN LEGAL AND REGULATORY REQUIREMENTS.

We face a broad range of legal and regulatory environments in the countries in which we do business.

Coordinating our activities to deal with these requirements presents significant challenges.

COMPLIANCE WITH MULTIPLE AND POTENTIALLY CONFLICTING LAWS AND REGULATIONS AND DEALING WITH CHANGES IN LEGAL AND REGULATORY REQUIREMENTS MAY BE DIFFICULT, BURDENSOME AND/OR EXPENSIVE.

We face a broad range of legal and regulatory environments in the countries in which we do business and identifying and complying with these regulations is complex.

We may not be successful in complying with regulations in all situations and could, therefore, be subject to regulatory actions and fines for non-compliance.

Changes in legal and regulatory requirements can impact our ability to engage in business in certain jurisdictions or increase the cost of doing so.

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The jurisdictional reach of laws may be unclear as well, such as when laws in one country purport to regulate the behavior of our subsidiaries or affiliates operating in another country.

Identifying the regulations with which we must comply and then complying with them is complex.

We may not be successful in complying with regulations in all situations, as a result of which we could be subject to regulatory actions and fines for non-compliance.

We are also seeing increasing levels of labor regulation in emerging markets, such as China, which affect many of our businesses.

Our global operations must comply with all applicable anti-corruption laws, including the U.S.

Foreign Corrupt Practices Act and the UK Bribery Act.

Foreign Corrupt Practices Act and the U.K.

These anti-corruption laws generally prohibit companies and their intermediaries from making improper payments or providing anything of value to improperly influence government officials or private individuals for the purpose of obtaining or retaining a business advantage.

Such prohibitions exist regardless of whether those practices are legal or culturally expected in a particular jurisdiction.

Although we have a compliance program in place designed to reduce the likelihood of potential violations of such laws, violations of these laws could result in criminal or civil sanctions and have an adverse effect on our reputation, business and results of operations and financial condition.

Our compliance program may not prevent violations of such laws, which could result in criminal or civil sanctions and have an adverse effect on our reputation, business and results of operations and financial condition.

laws and regulations govern the provision of products and services to, and of other trade-related activities involving, certain targeted countries and parties.

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Changes in governments or majority political parties may result in significant changes in enforcement priorities with respect to employment, health and safety, tax, securities disclosure and other regulations, which, in turn, could negatively affect our business.

LICENSING AND REGULATORY REQUIREMENTS.

The brokerage of real estate sales and leasing transactions;

real estate lending;

servicing and asset management;

property management;

construction;

mobile engineering;

conducting valuations;

trading in securities for clients;

and the operation of the investment advisory business, among other business lines, may require us to maintain licenses in various jurisdictions in which we operate and to comply with particular regulations.

We believe licensing requirements, including protectionist policies which favor local firms over foreign firms, have generally been increasing in recent years.

WE ARE SUBJECT TO COMPLEX AND EVOLVING LICENSING AND REGULATORY REQUIREMENTS.

Several of our business operations are subject to requirements in various jurisdictions to maintain licenses and comply with particular regulations.

If we fail to maintain our licenses or conduct regulated activities without a license or in contravention of applicable regulations, we may be required to pay fines, return commissions or investment capital from investors or may have a given license suspended or revoked.

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Failure to comply with any of these program requirements may result in the termination or withdrawal of our approval to sell loans to the Agencies and service their loans.

To fund the Agency loans we originate, we require short-term funding capacity.

As of December 31, 2021, we had $2.6 billion of committed loan funding available through commercial banks.

Consistent with industry practice, our existing warehouse facilities are short-term, requiring annual renewal.

Although we believe our current warehouse facilities are sufficient to meet our current needs in connection with our participation in the Agency programs, in the event any of our warehouse lines are terminated or are not renewed, we may be unable to find replacement financing on favorable terms, or at all, and we might not be able to originate loans.

The regulatory environment facing the investment management industry has also grown significantly more complex in recent years, principally in terms of marketing products and services and screening and advising clients.

The regulatory environment facing the investment management industry is also complex, principally in terms of marketing products and services and screening and advising clients.

Countries are expanding the criteria requiring registration of investment advisors and funds, whether based in their country or not, and expanding the rules applicable to those that are registered, all to provide more protection to investors located within their countries.

In some cases, rules from different countries are applicable to more than one of our investment advisory businesses and can conflict with those of their home countries.

Although we believe we have good processes, policies and controls in place to address the new requirements, these additional registrations and increasingly complex rules increase the possibility violations may occur.

These risks also apply separately to the LaSalle-managed public real estate investment trust we launched during 2012.

That entity has registered the securities it is issuing with the SEC in the United States and is subject to regulation as a public company, albeit not one separately listed on a stock exchange.

Although we believe we have adequate processes, policies and controls in place to address the new requirements, these additional registrations and increasingly complex rules increase the possibility violations may occur.

Laws and regulations applicable to our business, both in the United States and in other countries, may change in ways that materially increase the costs of compliance.

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This may include claims with respect to conflicts of interest where we are acting, or are perceived to be acting, for two or more clients with potentially contrary interests.

ENVIRONMENTAL LIABILITIES AND REGULATIONS;

CLIMATE CHANGE RISKS;

AND AIR QUALITY RISKS.

Our operations are affected by federal, state and/or local environmental laws in the countries in which we operate, and we may face liability with respect to environmental issues occurring at properties we manage or occupy, or in which we invest.

WE FACE RISKS RELATING TO ENVIRONMENTAL AND CLIMATE MATTERS.

We may face liability with respect to environmental issues occurring at properties we manage or occupy, or in which we invest.

We may face costs or liabilities under these laws as a result of our role as an on-site property manager or a manager of construction projects.

Our risks for such liabilities may increase as we expand our services to include more industrial and/or manufacturing facilities than has been the case in the past, or with respect to our co-investments in real estate as discussed above.

Within our own operations, we face additional costs from rising energy costs which make it more expensive to power our corporate offices.

The impact of climate change presents a significant risk.

Damage to assets caused by extreme weather events linked to climate change is becoming more evident, highlighting the fragility of global infrastructure.

We also anticipate the potential effects of climate change will increasingly impact our own operations and those of client properties we manage, especially when they are in coastal cities.

We anticipate the potential effects of climate change will increasingly impact the decisions and analysis LaSalle makes with respect to investments in the properties it manages as well as those it considers for acquisition or disposition on behalf of clients, since climate change considerations can impact the relative desirability of locations and the cost of operating and insuring properties.

Future legislation that requires specific performance levels for building operations could make non-compliant buildings obsolete, which could materially affect investments in properties we have made on behalf of clients, including those in which we may have co-invested.

Climate change considerations will likely also increasingly be part of the consulting work JLL does for clients to the extent it is relevant to the decisions our clients are seeking to make.

We also anticipate the potential effects of climate change will increasingly impact our own operations and those of client properties we manage, especially when they are in coastal cities and may impair asset valuations.

We anticipate the potential effects of climate change will increasingly impact the decisions and analysis we make with respect to investments in the properties we manage, as well as those we consider for acquisition or disposition on behalf of clients, since climate change considerations can impact the relative desirability of locations and the cost of operating and insuring properties.

Future legislation could require specific performance levels for building operations resulting in non-

compliant buildings becoming obsolete.

This could materially affect investments in properties we have made on behalf of clients, including those in which we may have co-invested.

Climate change considerations will likely also increasingly be part of the consulting work we do for clients to the extent it is relevant to the decisions our clients are seeking to make.

Around the world, many countries are enacting stricter regulations to protect the environment and preserve their natural resources.

Firms also may face several layers of national, regional and local regulations.

In Europe, the EU’s Environmental Liability Directive establishes a comprehensive liability standard, but individual EU countries may have stricter regulations.

The risks may not be limited to fines and the costs of remediation.

In Brazil, employees can risk jail sentences as well as fines in connection with pollution incidents.

In Brazil, employees risk jail sentences as well as fines in connection with pollution incidents.

In September 2020, China announced a commitment to be carbon neutral by 2060.

This follows environmental protection laws passed in 2014 designed to limit contaminated water, air and soil linked to economic growth and public health.

New environmental legislation and regulations may require the Company to make material changes to its operations, which could adversely affect our operating results.

New environmental legislation and regulations may require us to make material changes to our operations, which could adversely affect operating results.

Furthermore, the perspectives of shareholders, employees and other stakeholders regarding these standards may affect our business activities and increase disclosure requirements, which may increase our costs.

Declining air quality in major cities may have consequences for our business in various ways, including the need to respond to new regulations that affect the management of buildings, declines in the desire of investors or corporates to invest in or occupy properties in such cities, and our ability to retain staff in locations that may be relatively undesirable as places to live.

Financial Risk Factors

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and liquidity risk, including risk related to our credit ratings and our availability and cost of funding.

VOLATILITY IN TRANSACTIONAL-BASED REVENUE.

We have product offerings, such as Leasing and Capital Markets, that generate fees based on the timing, size and pricing of closed transactions, and these fees may significantly contribute to our earnings and to changes in earnings from one quarter or year to the next.

VOLATILITY IN TRANSACTIONAL-BASED REVENUE MAY IMPACT OUR PROFITABILITY.

We have product offerings, such as leasing and capital markets activities including investment sales and debt advisory, that generate fees based on the timing, size and pricing of closed transactions, and these fees may significantly contribute to our earnings and to changes in earnings from one quarter or year to the next.

Volatility in this component of our earnings is inevitable due to the nature of these businesses and the amount of the fees we will recognize in future quarters is inherently unpredictable.

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Volatility in this component of our earnings is also inevitable due to the nature of this aspect of our business, and the amount of incentive fees or equity earnings or losses we may recognize in future quarters is inherently unpredictable as it relates to client needs, the market and other dynamics in effect at the time.

CURRENCY RESTRICTIONS AND EXCHANGE RATE FLUCTUATIONS;

INFLATIONARY RISK.

CURRENCY RESTRICTIONS, EXCHANGE RATE FLUCTUATIONS, AND INFLATIONARY PRESSURES MAY MATERIALLY IMPACT OUR FINANCIAL RESULTS.

We produce positive cash flows in various countries and currencies that can be most effectively used to fund operations in other countries or to repay our indebtedness, which is currently primarily denominated in U.S.

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dollars, and thus our reported results are impacted by the strengthening or weakening of currencies against the U.S.

As an example, the euro and the pound sterling, each a currency used in a significant portion of our operations, have fluctuated notably in recent years.

Our revenue from outside of the United States approximated 41% of our total revenue for 2022.

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In addition, there can be no guarantee the counterparty will fulfill its obligations under the contractual agreement, especially in the event of a bankruptcy or insolvency of the counterparty, which would effectively leave us unhedged.

The COVID-19 pandemic caused significant volatility in U.S.

and international markets.

The impact of the pandemic may increase the possibility of uncertainty in the global financial markets, high inflation and extended economic downturn.

We are subject to inflationary pressures on employee wages, salaries, and the cost of various goods and services including energy costs that we procure which can materially impact our financial results.

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Credit rating reductions by one or more rating agencies could also adversely affect our access to funding sources, the cost and other terms of obtaining funding as well as our overall financial condition, operating results and cash flow.

INCREASING FINANCIAL RISK OF COUNTERPARTIES, INCLUDING REFINANCING RISK.

Unprecedented disruptions and dynamic changes in the financial markets, and particularly insofar as they have led to major changes in the status and creditworthiness of some of the world's largest banks, investment banks and insurance companies, among others, have generally increased the counterparty risk to us from a financial standpoint, including with respect to:

ADVERSE DEVELOPMENTS IN THE CREDIT MARKETS MAY IMPACT OUR ABILITY TO OBTAIN NEW CREDIT COMMITMENTS ON FAVORABLE TERMS AND INCREASE OUR EXPOSURE TO FINANCIAL RISKS OF COUNTERPARTIES WITH WHOM WE CONDUCT BUSINESS.

Disruptions and dynamic changes in the financial markets, may increase the counterparty risk to us from a financial standpoint, including with respect to:

• Obtaining new credit commitments from lenders

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General Risk Factors

ABILITY TO CONTINUE TO MAINTAIN SATISFACTORY INTERNAL FINANCIAL REPORTING CONTROLS AND PROCEDURES.

OUR BUSINESS IS SUBJECT TO GENERAL ECONOMIC CONDITIONS AND REAL ESTATE MARKET CONDITIONS AS WELL AS SUPPLY-CHAIN PRESSURES.

The success of our business is significantly related to general economic conditions.

Since then, many of our markets have been affected generally by various economic uncertainties, among them:

continued significant market volatility and volatility in energy costs, including oil and commodity prices;

the developing effects of climate change and severe weather;

and the continued uncertainty on the direction of global tax policy.

Recently, we have seen increased supply-chain pressures which may impact our ability to deliver goods and services to our clients and increase the resultant costs in doing so.

In 2022, we observed an increased potential for a global economic slowdown or recession, partly driven by increasing interest rates to tackle inflation, which presents an increased risk to our performance.

OUR REPUTATION AND BRAND ARE IMPORTANT COMPANY ASSETS, IF WE FAIL TO PROTECT THEM, OUR BUSINESS MAY BE NEGATIVELY IMPACTED.

The value and premium status of our brand is one of our most important assets.

As such, any negative media, allegations or litigation against us, irrespective of the final outcome, could potentially harm our professional reputation and damage our business.

further, our efforts to police usage of our intellectual property may not be successful in all situations.

WE MUST CONTINUE TO MAINTAIN SATISFACTORY INTERNAL FINANCIAL REPORTING CONTROLS AND PROCEDURES.

If we are not able to continue to operate successfully under the requirements of Section 404 of the United States Sarbanes-Oxley Act of 2002, or if there is a failure of one or more controls over financial reporting due to fraud, improper execution or the failure of such controls to adjust adequately as our business evolves, then our reputation, financial results and the market price of our stock could suffer.

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If we identify one or more material weaknesses in our internal control over financial reporting in the future that we cannot remediate in a timely fashion, we may be unable to receive an unqualified opinion at some time in the future from our independent registered public accounting firm.

POTENTIALLY ADVERSE TAX CONSEQUENCES;

CHANGES IN TAX LEGISLATION, REGULATION AND TAX RATES.

EXPOSURE TO ADDITIONAL TAX LIABILITIES STEMMING FROM OUR GLOBAL OPERATIONS AND CHANGES IN TAX LEGISLATION, REGULATION AND TAX RATES COULD ADVERSELY AFFECT OUR FINANCIAL RESULTS.

We face a variety of risks of increased future taxation on our earnings as a corporate taxpayer in the countries in which we have operations.

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Changes in tax legislation or tax rates may occur in one or more jurisdictions in which we operate that may materially impact the cost of operating our business.

In December 2017, the U.S.

government enacted comprehensive federal tax legislation commonly referred to as the Tax Cuts and Jobs Act (the "Act").

The Act included limitations on business-related deductions and increased taxation of foreign earnings in the U.S., which could increase our future tax expense.

Further changes to U.S.

corporate tax law have been proposed in the past year, including the proposed Build Back Better Act, some of which could further increase our future tax expense if enacted.

Recent legislative changes in the United States include the 2017 Tax Cuts and Jobs Act and the 2022 Inflation Reduction Act, which have introduced limitations on business-related deductions and increased taxation of foreign earnings in the U.S., and a corporate minimum tax, all of which could increase our future tax expense.

In addition, the potential exists for significant legislative policy change in the taxation of multinational corporations, as has recently been the subject of the “Pillar One” and “Pillar Two” initiatives of the Organization for Economic Co-operation and Development, the European Union Anti-Tax Avoidance Directives, and legislation inspired or required by those initiatives.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors