Risk Management and Corporate Governance

The current edition of the NSE Quarterly
Briefing is on “Risk
Management and the Board of Directors in Indian Firms
” and is drafted by Professor Afra Afsharipour.
The executive summary is as follows:
– Enterprise
Risk Management (“ERM”) is a systematic and holistic approach for firms to
address all their risks, whether operational, strategic or financial.
– Although not
involved in the everyday management of risk, the board of directors plays an
important oversight role in ERM by guiding and reviewing the company’s risk
policy and ensuring that an effective risk management system is in place.
– Like elsewhere
in the world, India’s regulatory structure provides that the board must play a
central role in risk management.
– Corporate
India has become much more engaged with ERM, although there is room for
improvement.

– Enhancing
the board’s risk management role can help address the many complex areas of
risk faced by Indian firms.

About the author

Umakanth Varottil

Umakanth Varottil is an Associate Professor at the Faculty of Law, National University of Singapore. He specializes in corporate law and governance, mergers and acquisitions and cross-border investments. Prior to his foray into academia, Umakanth was a partner at a pre-eminent law firm in India.

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