UK companies are increasingly adopting a risk-taking stance as CEOs realise the importance of risk management, according to recent research. Almost 70% of respondents in the Deloitte & Touche Financial Controllers Risk Management Survey 2001 perceive risk management as a beneficial tool to gain competitive advantage, enhance business practices and positively change business. This is an increase of 38% from 1999. Although the number of companies that rate themselves as risk-takers has risen from 20% in 1999 to 35% in 2001, almost 50% still consider themselves averse to risk.
CEOs are increasingly taking on the ownership of risk management, indicating that it has become a boardroom issue. CEO ownership of risk management rose from 10% in 1999 to 35% in 2001, suggesting that boards are being subjected to increased scrutiny from stakeholders.
The research also noted a trend in the increase in risk ownership by a company’s audit committee, from 2% in 1999 to 11% in 2001. Malcolm McCaig, risk consulting partner at Deloitte & Touche, said that this raises concerns about the ability of the audit committee to provide an independent challenge to the effectiveness of the overall risk management process.
The results are based on the responses of more than 60 financial controllers of FTSE 350 companies.
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For a copy of the Deloitte & Touche Executive Briefing on Risk Management, contact Claire Saynor on 020 7303 5890
