Of course, members of your Board of Directors worry about financial risk.
But, new survey results from EisnerAmper clearly indicate that financial risk isn't the only issue that has board members biting their nails.
EisnerAmper's second annual Board of Directors Survey, Concerns About Risks Confronting Boards, showed that in addition to financial risk, board members are also concerned about:
Reputational risk (69 percent)
Regulatory and compliance risk (61 percent)
CEO succession planning ( 55 percent)
IT risk (51 percent)
More than 140 board members, sourced from both NACD Directorship and EisnerAmper databases, participated in the survey. Respondents represented both public and private companies, and 31 percent identified themselves as serving on audit committees.
Deep-diving into the regulatory and compliance risk category, EisnerAmper found that the board members polled are most concerned about:
financial reform (58 percent)
accounting standards (49 percent)
Sarbanes-Oxley, healthcare reform, environmental, tax and energy regulation
In addition, the directors said that their CEOs needed more education on broad-based risk assessment, updates on regulatory compliance change and aligning business goals to IT. For CFOs, they said the top three challenges are IFRS implementation, changes to tax from new regulations and creating financial models for strategic direction. Fourteen percent said they were unaware where their companies stood with regard to implementation, yet almost 50 percent cited accounting standards their primary regulatory concern.
"Reviews and process checks at the board level are now critical, while new rules springing from Dodd-Frank add an as yet unknown dimension of concern," Jim Mack, partner and leader of EisnerAmper's consulting services practice, said.
A PDF of the Concerns About Risks Confronting Boards is available here.