Startling Results

A recent survey of banking executives across the world provides confirmation of the very issues discussed on The ERM Current™ and should be a wake-up call to all corporate boards of directors - financial and non-financial alike.   The survey was conducted by KPMG and here is a sample of the results:

More than three-quarters (76 percent) of the almost 500 global banking executives surveyed report that risk management is still stigmatized as a support function at their bank. Only half (48 percent) said that risk management is understood to be the responsibility of everyone in the organization, and another 45 percent of respondents said their board lacks risk expertise.  When asked to rank the leading contributors to the credit crisis, the banking executives named incentives and remuneration (54 percent), followed closely by lack of risk governance (50 percent) and risk culture (48 percent).

For those who have been following The ERM Current™, these results should come as no surprise.  However, for those new readers, these are startling results indeed.  Much work remains to strengthen risk management practices and to ensure that they remain a vital part of corporate operations.