As former SEC Chairman and Compliance Week Columnist Harvey Pitt wrote in these pages back in June 2004: “Management’s most important job is identifying, assessing, and managing risk.” Unfortunately, that is easier said than done, especially when it comes to communicating that risk to the board. In fact, as Pitt pointed out, management regularly fails to communicate risks to directors on a timely basis, “imperiling the value of a company’s securities and ensuring embarrassment (or worse) when inevitable crises occur for which the company is unprepared.”
