Risk is a natural part of business and most business leaders understand that managing risk effectively is key to success. However, many organizations don’t fully understand the risks they have assumed, nor whether that risk is monitored, managed or aligned with the organization’s risk tolerance. It’s important for businesses to gain a holistic view of risks to manage them effectively, since value-destroying risks can come from anywhere including cybersecurity events, regulatory reporting obstacles, operational challenges, supply chain disruptions and finance challenges.
Key Takeaways:
- It’s important for businesses to gain a holistic view of risks to manage them effectively, since value-destroying risks can come from anywhere including cybersecurity events, regulatory reporting obstacles, operational challenges, supply chain disruptions and finance challenges.
- A risk culture means incorporating the concept of risk and risk management into executive communications, actions and decisions.
- Planning must take into account the various layers of management within the business as well as the different risk types such as operational, legal, financial and reputational risks.
“The Association of Certified Fraud Examiners (ACFE) Global Fraud Study 2016 reveals that the median loss of $703,000 caused by an owner-executive was more than four times higher than the median loss caused by managers ($173,000) and nearly 11 times higher than the loss caused by employees ($65,000).”
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