This is a post about news we should have known for a long time.
It’s time to recognize the truth about risk management.
For 11 years, the ERM Initiative at North Carolina University has surveyed executives (this year they were again all financial executives) about what they call “the current state of risk oversight processes in organizations of all types and sizes to obtain an understanding of the relative maturity of underlying activities executives and boards use to monitor the rapidly changing risk landscape”.
On April 1st, they published the 2020 The State of Risk Oversight: An Overview of Enterprise Risk Management Practices – 11th Edition.
It is jarring to see how the authors continue to ask the wrong questions.
Consider how the Journal of Accountancy wrote about the study. This is their lead observation about the results of the study:
While concerns about risk, even before the virus outbreak, have not subsided, fewer finance executives were finding strategic value in their risk management processes. In 2016, 20% of respondents said they believed that risk management mostly or extensively provides strategic value. In the most recent survey, the number was 17% — a small drop, but still the third consecutive year of one-percentage-point declines.
Note that the survey says ONLY 17% BELIEVE RISK…
