Why the Whole Board Needs to be on Top of Risk Management

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Delegating risk oversight to committees is not enough.

Following the 2008 financial crisis, Mary Schapiro, the former chairwoman of the Securities and Exchange Commission (SEC), said during testimony to the financial crisis inquiry commission that “the quality of a board’s oversight of risk management – traditionally viewed as just a compliance cost – can make an enormous difference in our economy, and particularly in financial markets.

Source : Thomas Keusch is an Assistant Professor of Accounting and Control at INSEAD. https://knowledge.insead.edu/leadership-organisations/why-the-whole-board-needs-to-be-on-top-of-risk-management-5049

Risk Management : Avoiding Blind Spots – Corporate Compliance Insights

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Addressing the Bias Problem

Though virtually every involved party was at fault to some degree, bias on multiple fronts was largely the cause of the 2008 financial crisis. Given that bias in risk management can result in a disastrous event such as this one, protecting against biases is critical. Jim DeLoach presents several strategies to overcome these blind spots and effectively address operational risks.

Few would argue that the 2008 financial crisis was likely the most spectacular failure in risk management recorded to date. There are so many causal factors and culpable parties, we cannot possibly cover them all. One of my favorite books on the subject is All the Devils Are Here: The Hidden History of the Financial Crisis.[1] The promo for this outstanding, highly readable book reads as follows:

As soon as the financial crisis erupted, the finger-pointing began. Should the blame fall on Wall Street, Main Street or Pennsylvania Avenue? On greedy traders, misguided regulators, sleazy subprime companies, cowardly legislators or clueless homebuyers? According to [the authors], the real answer is all of the above – and more. Many devils helped bring hell to the economy. And the full story, in all of its complexity and detail, is like the legend of the blind men and the elephant. Almost everyone has missed the big picture. Almost no one has put all the pieces together. http://www.corporatecomplianceinsights.com/addressing-bias-problem-risk-management/?lipi=urn%3Ali%3Apage%3Ad_flagship3_profile_view_base_recent_activity_details_shares%3Bs%2FPGSYK0SFC1cACCknYw0w%3D%3D

Ireland Jails Three Top Bankers Over 2008 Banking Meltdown — Fortune

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The Bernie Madoffs of Ireland are headed to Mountjoy Prison.

via Ireland Jails Three Top Bankers Over 2008 Banking Meltdown — Fortune

Survey : 66% of IT pros think their companies’ cyberincident response plans are ineffective

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Les entreprises ne parviennent pas à élaborer, mettre à jour et exécuter des plans de réussite de réponse aux incidents dans le cas d’une cyberattaque dommageable, met en garde contre un nouveau livre blanc d’entreprise AT & T . Le rapport cite une enquête entreprise de 800 entreprises mondiales dans lequel 81 pour cent de celui-ci professionnels a dit leurs sociétés a un plan de réponse aux incidents en place, mais seulement 34 % d’entre eux ont estimé que le plan a été efficace.

Selon le rapport, intitulé le PDG de Guide à la réponse de Cyberbreach, les nombreux plans de réponse aux incidents souffrent du manque d’une équipe de leadership à l’échelle de l’entreprise et interfonctionnels, tandis que les autres régimes ne subissent pas de tests et de les retravailler assez souvent.