More than 70 percent of 200 board directors revealed their companies are not formally executing mature and robust risk oversight processes, while nearly 60 percent of 460 respondents admitted that their risk management processes are ad hoc and informal in the results of two surveys conducted by the Committee of Sponsoring Organizations of the Treadway Commission.
COSO said conducted the polls to gauge the current state of enterprise risk management and board risk oversight.
The first COSO survey was in partnership with global consulting and internal audit consultancy Protiviti. Board members were divided on the effectiveness and maturity of their processes and efforts, according to the survey.
"Risk oversight is a high priority on most boards of directors' agendas," said Jim DeLoach, a managing director at Protiviti. "Our survey findings provide valuable insights on how a board can advance to a more mature stage in its oversight of risk - a critical issue as new legislation and regulations force boards to rethink their structure and mission as it relates to risk oversight."
Despite 70 percent indicating no mature or robust oversight process, some 53 percent of participants rated the risk oversight process in their organizations as "effective" or "highly effective."
The second poll, conducted by COSO with the assistance of the ERM Initiative at North Carolina State University, obtained information from corporate management about the current state of their risk oversight processes.
In addition to the majority of those respondents admitting to having ad hoc and informal, just over 42 percent described their organization's level of functioning of ERM as "very immature" or "somewhat mature" and about one-third (35 percent) revealed that they are "not at all" or are "minimally" satisfied with the nature and extent of reporting to senior executives of key risk indicators.
COSO, the ERM Initiative at North Carolina State and Protiviti will conduct a webinar covering both of the above survey report results on Jan. 26, 2011. To register go to:
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