The vast majority (85%) of surveyed corporate executives agree that they need to overhaul their approach to risk-management if the lessons of the economic crisis are to be used to improve business results, according to results of an Accenture study released today.

Four in ten respondents (40%) said their companies have already increased or will increase their investments in broader risk-management capabilities in the next six months. Nearly another third (31%) said their companies are now considering increasing their future investment in risk management capabilities.

Those findings are from Accenture's 2009 Global Risk Management Study, which is based on a survey of 260 chief financial officers, chief risk officers, and other executives with risk-management responsibilities at large companies in 21 countries.

The survey also found that companies expect new risk-related challenges as a result of the current economic environment, including more stringent regulations and increasing costs associated with growing complexity in the risk environment. For instance, 41% of respondents reported that their risk-management costs have increased at least 25% in the past three years, including 14% who reported a 50% rise in such costs.

Asked to identify the biggest challenges they face over the next two years as they develop more rigorous risk-management capabilities, respondents pointed to the difficulty of aligning with the overall business strategy (identified by 93% of respondents); the need for more effective collaboration with business units (89%); the need for greater integration in the firm's processes and culture (89%); and inadequate resources and talent (88%).

Accenture's analysis pointed to a lack of integration of current risk-management and performance-management processes: While nearly half the respondents said their company's risk-management function is involved to a great extent in strategic planning (48%) or in investment and divestment decisions (45%), only 27% said the risk-management function was involved to a great extent in objective-setting and performance management.

Enter your email address to continue reading

Execs: Need to Overhaul Risk Management

Don't worry...it's free!

Already a member? Sign in now.

Sign in with your preferred account, below.

Did you like this article?
Know someone who would enjoy it too? Share with your friends, free of charge, no sign up required! Simply share this link, and they will get instant access…
  • Copy Link

  • Email

  • Twitter

  • Facebook

  • Pinterest

  • Linkedin