Most significantly, it seems clear that policies on corporate governance will increasingly require the regulation of risk to be addressed at the highest level. Principles on corporate governance, set out by the Organisation for Economic Co-operation and Development (OECD), list the ‘..review and guidance of …risk policy…’ amongst the duties of the board. Notes to these principles state that: ‘Another important board responsibility is to implement systems designed to ensure that the corporation obeys applicable laws, including tax, competition, labour, environmental, equal opportunity, health and safety laws.’
Guidance by the Institute of Chartered Accountants in England and Wales (ICAEW) in its publication on Internal Control under the Combined Code (‘the Turnbull report’) brings these concepts firmly to the fore in the UK context. The language of risk management permeates the document. When this is added to the points discussed above, it would be disappointing if most businesses did not in future accept risk management as a key element in maximising shareholder value.
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