The Increasing Significance of Enterprise Risk management

New York Law Journal

 Share  print   Print        Download PDF

PUBLISHED ON: December 12, 2011

PROMINENT SCANDALS involving three major U.S. publicly traded corporations about a decade ago, resulting from fraudulent accounting practices and executive corruption, raised urgent questions about the ability of corporate boards of directors to “mind the store”—and, in turn, impelled consideration of how better to deploy effective risk management techniques and assign responsibility for them.

More recently, during the financial liquidity crisis of 2008-2009, excess leverage and counterparty solvency issues in derivative and securities trading led to the “bail outs” of major financial institutions—and a fresh round of introspection regarding risk management.