Framing Strategic Risk in the Boardroom

Despite the high stakes, identifying and managing strategic risks has been a difficult task. It is often unclear what to look for, signals to identify such risks are often weak, sources of information are not easily known as they are within other industries and geographies, and traditional tools and methods don’t reliably detect what is “over the horizon.” To add to the challenge, many companies have traditionally separated their risk and strategy functions and think of risk as more of a compliance responsibility rather than a dynamic tool for value creation, business performance management, and growth. And, while the strategy setting process has begun to factor in the many changes occurring in the world, risk management is still often considered to be a narrowly de ned core activity.