Recent Articles
Posted on February 4th, 2010 by Katina »Permalink
What a difference a financial crisis makes. It’s not been long since industry headlines were dominated by GRC and SOX and SoD and IdM and a host of other acronyms that folks like our dear readers (okay, and ourselves) dearly love to toss around. Now, though? It’s risk, risk, and more risk.
This week is no different. Deloitte’s CEO Barry Salzberg takes a nicely comprehensive look for Forbes at how businesses should be considering and approaching risk, and he makes some good points, especially when he emphasizes the importance of minimizing dangerous risks without sacrificing risks that can create value. As he points out, lending, for instance is risky for banks – but as headlines keep reminding us, nobody likes it when banks stop lending – and banks can’t live long without risk.
He also drives home something that we at Approva stress with our clients – how key it is to bring stakeholders across the business together to identify risks and decide how best to address them. It’s pretty unavoidable as a starting point.
David McCann at CFO Magazine makes a similar point in a big piece on just where the GRC market stands these days. He says it better than we can: “Many companies are still saddled with narrow, duplicative approaches to GRC that lead to both economic and operational inefficiencies. Extra costs accrue when, for example, several different business units and functions separately track and manage a single risk factor — especially if, as is common, each buys its own software for the task.”
This is something we’ve been talking about at Approva for ages – and one of the best things about our Continuous Controls Monitoring solutions is that they enable our clients to achieve visibility across business processes so that they can monitor mistakes and errors in real-time and inspect transactions and data to catch exceptions before they become problematic. We’ll be talking more in coming weeks about how much sense this makes for risk management – and for overall business efficiency as well.
Posted on February 2nd, 2010 by Katina »Permalink
It seems like just last week that we were talking about companies taking a more global approach to identifying and addressing risk throughout the enterprise, digging a little deeper than the first risks to come to mind. It looks like the SEC is in on this one, too, getting downright out-of-the-box on the risks it wants investors to consider. Compliance Week has the goods their recent decision to include climate change among the risks companies must disclose to investors in 10Ks. Now that’s an awfully literal interpretation of the global approach, but anybody who’s seen The Day After Tomorrow can probably see the logic in considering risks to businesses from a changing climate. (And we have to award just a few points for creativity on that one).
Speaking of risks that aren’t necessarily the first to come to mind, @VisualRiskIQ tipped us off (should we say tweeted us off?) to an interesting piece from Inside Counsel on risks to businesses from corporate disclosures made via social networks or Twitter. Hint: It’s probably not a great idea to tweet from an earnings call unless one happens to be very familiar with 140-character required disclaimers.
Speaking of the SEC, Reuters (via ComplianceEX) details plans in the White House’s proposed 2010 for beefed-up funding for it and the Commodities Futures Trading Commission, as part of efforts to better monitor just what’s going on on Wall Street – and hopefully avoid a repeat of a certain highly unpleasant financial meltdown. The budget sets aside nearly $1 billion for various regulators – all contingent on the passage of financial regulatory reform. We’ll keep you posted as this one develops.
In the meantime, our Comments are a great place to weigh in on changes you’ve seen in how businesses are approaching risk. Seriously.
Posted on January 28th, 2010 by Katina »Permalink
It seems like everybody’s talking risk these days – and of course we’ve been doing a good bit of that ourselves. Which is why our interest was piqued this week by Malcolm Gladwell’s latest piece for The New Yorker (subscription required for full article). As is his wont, Gladwell once again uses his column to take a common assumption – in this case, that entrepreneurs thrive by being a risk-taking, live-on-the-edge bunch – and turns it on its head. The resulting piece is an interesting exploration about some of the corporate world’s greatest success stories, Ted Turner and John Paulson among them, and carefully shows how their ability to identify and mitigate risk – far from embracing it – is a crucial element of their success.
It’s a thought-provoking deconstruction on its own, but it’s even more so when read in the context of the recent financial meltdown . . . not to mention the American myth of the entrepreneur as the ultimate risk-taker. There’s plenty of food for thought on just what might happen to the corporate world if people come to view risk as something to be managed on a global scale rather than taking a tactical approach. Not to mention fodder for discussion on the ways that businesses encourage corporate risk-taking, when perhaps they should be doing the reverse.
Speaking of approaches to risk, CFO has a piece on Top 10 Risk Hot Spots from the Corporate Executive Board. It’s worth a look to see what’s on there beyond the perennial favorites like fraud and compliance.
Have some thought to share on risk assumptions and priorities? The comments are a great place to weigh in . . .
Posted on January 26th, 2010 by Katina »Permalink
So, the 2010 kick-off predictions continue, and this one, in which Compliance Week predicts the governance story of the next decade, is a must-read. The gist, from the article itself –
“The bottom line is simple: The big governance story of the 2000s was big government itself; corporate boards had to grapple with and adapt to the sweeping anti-fraud policing of Sarbanes-Oxley. The big governance story of the 2010s will be whether shareowners grow into the rights about to be handed to them and exercise those rights wisely.”
It’ll be interesting to see how this jives with proposed regulatory reforms – how (or whether) reforms ultimately passed give more power to shareholders. As if we didn’t have enough reasons to be on the edge of our seats with this one. While we wonder what’s going to happen and how it will affect our customers, perhaps we can suggest a little light reading from WebCPA, which has a nicely informative piece on what sorts of reforms the PCAOB is considering. Provided the Supreme Court lets them, of course.
Speaking of regs reform, CFO speculates that increased regulation might bring about a jump in law suits. Great news for trial lawyers, but potentially very expensive news for the parties who’ll be involved. Now, nobody blogging at AuditTrail is much of a legal expert, but in thinking about this move toward more litigation, the value of real-time controls monitoring (and documentation thereof) seems like an even better idea than before.
Finally and on a thankfully lighter note, the good folks at GoingConcern tipped us (and all their readers) off on what is sure to be a sensation – Enron. The musical! Check out more on it here. There’s video, people. Enjoy!
