The Organizational Drag of Risk Management Must be Diminished

Strategic Risk Management
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Jaap de Jonge
Editor, Netherlands
Regulators and organizational leaders were largely unprepared for the 2008 financial crisis, but reacted strongly after it occurred. This has led to a situation in which risk managementís operational drag in most large firms has now become too big and has to be reduced. A 2014 paper by CEB shows data taken from its members that only 6% of time spent by audit departments on risk types is spent on strategic risks. While this category is responsible for 86% of the significant losses in market value over the last 10 years. And on the other hand, no less than 52% of time is spent on financial, legal and compliance issues, while such issues only account for 5% of all significant market value losses. The conclusion is that nowadays risk departments are looking for risks in all the wrong places. In reaction to market turmoil, companies have been increasing their governance and risk management budgets. But an excessive or even exclusive focus on risk prevention and formalized risk management p (...) Read more? Sign up for free

  Steven Cooke

Risk Management Misdirection

Yes, of course companies should focus on value cre (...)

  Love Lonnroth
Management Consultant, Sweden

Risk Management Should Be Lean or Agile

Thank you Jaap for bringing up an important issue. (...)

  Stephanie Dolan
Entrepreneur, United States

The Customers' Trust of your Business

Personally, I believe if we tabled just for a mome (...)

  Keatsen LIU
Professor, China

Risk Management not Only an Organizational Drag

Thanks for this hot topic. Risk Management is not (...)

  jorge anibal hoyos hoyos
Manager, Colombia

Everybody Must Execute Risk Management

At every level, component, procedure into the comp (...)

  Dr Robin C Hesler

The Organizational Burden of Risk Management

The subject refers to "strategic" which means to m (...)

  Juan Manuel Ugarte
Professor, Mexico

Avoid Over-regulation of Risk Management

Thanks to the Editor for the discussion of this to (...)

Professor, Mexico

Risk Management Not Only About ISO 31000

It is very important today in all companies that t (...)

  jorge anibal hoyos hoyos
Manager, Colombia

Everybody Must Be Educated on Risk Management

I think all people must be taught how to identify (...)

  Barney Wade Howard
Manager, United States

Risk Management is Needed But Not Need not be Complicated

Today more than ever this topic is a hot one. Howe (...)

  Juan Manuel Ugarte
Professor, Mexico

Proportionality of Risk Management

As I wrote @earlier, criteria such as proportional (...)

Manager, Canada

Risk Management & Business Ethics

If businesses acted with integrity there wouldn't (...)

  Kasper Hiddema
Student (University), Netherlands

Best Practices for Dealing with Risk in Organizations

Indeed in the wake of a crisis, both regulators an (...)

  Jaap de Jonge
Editor, Netherlands

History of Risk Management in Business Banks

Until the 1980s, business and investment ba (...)

  John Maddalena
CEO, South Africa

Involve Risk Champions in Strategy Meetings for Risk Implications

Agree with the views in the topic. While I apprec (...)


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