Risk Oversight: What Every Director Should Know

The public and political perception that excessive risk-taking was to blame for the global financial crisis has led to a number of legislative and regulatory actions concerning the role of the board in risk oversight. This article discusses the main factors driving the pressure on boards to oversee corporate risk and the potential consequences of this emphasis on risk oversight. The author describes how companies are responding to the higher demand for board involvement in risk management -- particularly as what began as a distinctly U.S. trend is crossing the Atlantic and being felt in European boardrooms.