Financial Executives Slowly Warming to Risk Management Planning
Despite the American Institute of Certified Public Accountants’ (“AICPA”) latest survey revealing organizations have inadequate risk management practices, the numbers compared to the inaugural survey have improved. The AICPA discovered that 31 percent of companies have created processes for enterprise risk management. That number is 22 percentage points higher than in 2009; only nine percent of organizations surveyed that year reported having risk management processes.
The survey is part of the AICPA and North Carolina State University’s Enterprise Risk Management Initiative. Mark Beasley, the director of NC State’s ERM Initiative, said this year’s survey shows that more senior executives and boards of directors recognize that an uncertain global business environment is surpassing the ability of their company’s traditional methods to handling risks.
Other survey findings include 22 percent of financial executives describing their company’s risk management oversight as mature or robust. The survey also found that larger companies, public businesses and financial services companies are likely to adopt risk management practices faster than smaller entities. Nonprofits are also beginning to incorporate risk management practices.
If you have questions concerning risk management, reach out to a member of Cherry Bekaert’s Risk Advisory Services team.