Risk Management, Compliance, and Disclosure at the Board Level

The board’s risk oversight responsibility has become more complex and subject to enhanced scrutiny from the courts in recent years. Institutional investors have identified risk oversight as a critical governance issue while pushing for more meaningful disclosures on the board’s risk oversight activities. Although the day-to-day risk management belongs with management, the board must engage proactively in monitoring key corporate risk factors and working with executives on a strategy to mitigate risks. How can directors work most effectively with management to understand the company’s risk appetite, the nature of material risks, their