Is Risk Management a Weak Spot for Your Corporate Board?

Before we know it, the first quarter of 2014 will be nearing its end to give way to the second quarter. For many of us, such a transition means a time to review what we’ve accomplished so far.

It’s also a time to check up on your corporate board of directors. How are they faring so far? Have areas of improvement been successfully addressed, or at least, initiated?

Risk Management as a Weakness

According to the McKinsey Global Survey results from last year, risk management is still a weak spot for most corporate boards because directors are still generally complacent despite the financial scandals in the previous decade. The problem stems from the lack of sufficient knowledge on the actual risks their companies face. Based on the survey, only 12 percent of boards’ time is spent on risk management.

This is a concerning statistic given the number of risks boards face on a regular basis. And as we’ve talked about before, the digital age ushered in a whole new set of risks such as cyber security and social media, to name a few.

Directors and Risk Management

If your directors have been doing well in risk management, then kudos and keep up the good work. But if your board needs to improve in this aspect, make sure to include it in the list of the boards’ goals for the second quarter. Encourage directors to pay greater attention to risks, to give more time on knowing more about these, and most importantly, to learn from the mistakes of their peers. After all, experience is the best teacher, but who says it always has to be your own firsthand experience?

Include the board portal in your board’s second quarter goals, too!

Try out Convene, a board portal solution that works on iPads and Android tablets. It supports better corporate governance by making the whole meeting process more transparent.