Board directors at global businesses are failing to identify and manage emerging risks effectively, despite spending more time on risk management, according to new research published by Lloyd's.
The research found that over half of companies had at least one ‘near miss' and that one in three had suffered significant damage as a result of failure to manage risk.
It also found that boards are now assessing a wider range of risks in the light of corporate scandals and regulatory intervention, but are ignoring other headline risks such as terrorism and the weather. Despite recent terrorist attacks, less than half of companies are reassessing their risk management strategies, and less than a quarter are reassessing natural hazards.
Lloyd's director of worldwide markets Julian James said: "This research clearly shows that businesses accept they should be doing more to recognise and prepare for the potentially crippling risks that they face."
The findings also show that many of the problems that organisations face are structural as well as attitudinal, with many failing to embed a culture of risk management throughout their organisations.
In only half of all companies surveyed was risk management centralised and two thirds of boards have received no training in either identifying emerging risk or implementing risk management.