According to the 2011 Annual Corporate Director Survey issued by PricewaterhouseCoopers, LLP, risk management remains at the top of the list of stakeholder concerns. Only 19% of directors measured their board as very effective at monitoring a risk management plan that mitigates corporate exposure. In an effort to enhance this performance, 57% of respondents reported they would like to increase their focus on risk.
In particular, corporate directors want to focus on adapting to the changing risk landscape for more effective risk management. Significant risks to companies in today’s environment span across all areas of a business: operational, financial, environmental, and IT security risks. The following are survey findings concerning different areas of risk and risk management.
- Directors recognize that emerging technologies can create competitive advantages, but more work is needed for effective oversight of IT risks
- 46% of directors believe the board’s ability to oversee strategic use of IT is less than effective
- 38% of directors want to spend more time on IT
- A significant number (67%) of directors currently address IT risk by relying on the board’s understanding of the business and working with management.
- However, a majority (52%) say it is difficult to find IT expertise to add to their boards
Corporate Compliance Concerns
- Due to a growing frequency of investigations related to the Foreign Corrupt Practices Act, there is a specific concern about bribery and corruption (11%)
- 41% of directors have increased concern about all types of fraud
- Boards are enhancing their oversight of the company’s crisis management planning
- 88% indicate they have discussed business continuity plans during the last 12 months
- Looking forward, 38% report they would like to increase their focus on crisis management planning
- In the 2010 survey, only 67% of directors indicated they discussed an action plan to deal with a major crisis during the last year
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