Blog: When Boards Are Surprised, Who’s at Fault?

In his blog, IIA President and CEO Richard Chambers, CIA, QIAL, CGAP, CCSA, CRMA, shares his personal reflections and insights on the internal audit profession. Here’s an excerpt from his latest post:

The number of shocking corporate scandals that have damaged major corporations reads like part of a top 10 list of news events from the past decade — Toshiba’s accounting debacle, Volkswagen’s dieselgate, Wells Fargo’s fake accounts, Carillion’s collapse, Nissan’s CEO salary fiasco.

All proponents of good governance — from investors to regulators to compliance and risk managers to providers of independent assurance — should be deeply troubled by these high-profile scandals. What’s worse, these examples of governance failures have a common and troubling subplot: In every case, the boards of these mature and highly sophisticated corporations were largely in the dark about the extent of significant risk management flaws that eroded shareholder value.

Any analysis of this leads to the obvious question: Where was the board? The IIA’s recently published risk report, OnRisk 2020: A Guide to Understanding, Aligning, and Optimizing Risk, offers some valuable insights that could help answer the question.

Read the full InternalAuditor.org blog post from IIA President and CEO Richard Chambers.