RISK: Half of private companies think they must improve financial risk management: study

Respondents optimistic Big Data can help

Fifty-two percent of private-company directors think their boards’ financial risk management needs improvement, a KPMG study found.

The top challenges are attracting and maintaining financial talent (19 percent), insufficient financial expertise on the board (14 percent), lack of transparency (13 percent) and limited accuracy in internal financial timelines (12 percent).

“Governance models are in constant need of fine-tuning,” Brian Hughes, KPMG’s national private markets group leader, said in a statement. “Owners and management teams need to share the right information with the right set of advisers and board members, starting with the organization’s risks to help shape the vision and strategy for the organization to remain competitive.”

Going forward, survey respondents think new data and analytics technologies will help their companies improve trend spotting, resource allocation and risk management. But using new technologies will, of course, increase cyber risk; directors are most concerned with network security (32 percent), systems integration (22 percent) and employee-related (16 percent) risks.

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