Corporate risk managers are too focused on complying with regulations at the expense of helping their companies operate, according to a new report.The report, published today by PricewaterhouseCoopers and the Economist Intelligence Unit, criticises corporate risk managers for "a tendency for successful risk management to be defined in regulatory terms".
The danger, the report says, is that reduced regulatory pressure will mean managers will ignore risk management issues. "If this is the case, it would certainly be dangerous. Should an event that could have been foreseen take place in the context of less rigorous management oversight, the market and regulators are likely to be hostile in their reaction," the report says.
Risk managers also tend to be shut out from strategic decision making – in fact, this trend has increased since the last survey in 2004. According to the survey, 47% said risk assessment is formally involved in their company's strategy development (down from 50%), and only 40% said it is involved in budgeting and financial reporting (down from 54%).
The survey included 420 senior executives from financial services companies worldwide.
Topics: PricewaterhouseCoopers (PwC)
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