Board Members Themselves Seldom Receive Risk Training

As reported by HRI, "Just 14% of board members are confident that their organizations' boards understand, and will respond correctly to, risks facing their foreign operations," declared a 2005 report on risk management from the insurance firm Lloyd's of London and the London business analysis firm the Economist Intelligence Unit. Ironically, the survey of more than 100 business leaders in international organizations found that fewer than one in three respondents provided board members with risk management training or thought that risk management skills were important. Eighteen percent of the respondents indicated that their board members had risk management training. Said David Foreman, chief underwriting officer of Wellington, a Lloyd's insurer, "Whether the lack of preparedness to anticipate and deal with risk reflects misplaced confidence or ignorance is debatable. But until boards start to tackle these issues, risk management is likely to be seen by senior management as a constraint on their business, rather than the source of competitiveness it should be." (Best's Review [Green], December 2005, p. 113)