The SEC’s case against former Countrywide executives demonstrates that effective GRC is all about people.

Not process. Not technology. People.

This reality is depressing and/or hopeful, depending on your view of human nature. (I’m firmly in the “and” camp.)

For those of you involved in your organization’s GRC efforts, the key question is: Do you behave more like (a) Eric Sieracki or (b) John McMurray? more

Last month, I wrote about the benefits of exchange-traded instruments, which treasurers can use to hedge their firm’s exposure to fluctuations in interest rates and foreign currencies. Of course, there’s another option – pun intended – treasurers can use, as well. Over-the-counter instruments, such as forward contracts and options, also offer viable ways to hedge a company’s risk. The use of options has grown steadily over the past few years. According to the Bank of International Settlements, the gross market value of over-the-counter foreign exchange derivatives rose from $38 to $75 billion between 2006 and 2008. more

In a previous post, I mentioned the strong attendance at the Beyond Budgeting Round Table’s annual conference in San Francisco.

I’m going to share a few other high-level conference insights below. However, if you want a more interactive discussion, please tune in to our Post-Conference Webcast at 10 a.m. CST on Tuesday, June 9. The webcast will include a rundown of the event by featured conference speaker Bjarte Bogsnes, who is currently heading up a Beyond Budgeting implementation at the Norwegian oil company StatoilHydro, which is Scandinavia’s largest company. Bogsnes is also the chairman of BBRT Europe and one of the few persons to lead two different Beyond Budgeting implementation efforts, having previously done so for Borealis. more

Does your workforce’s financial stress qualify as an emerging risk?

A company that operates a financial help line for corporate clients has published a report with some troubling data and an ominous warning: “… we are entering a ‘perfect storm’ for retirement planning which will have a huge impact on our society. The credit crisis was the first financial crisis to hit us. The retirement crisis will be next.”

The report is based on an analysis of all the employees from different companies that use the firm’s financial help line.

Not surprisingly, employees’ overall financial stress levels rose significantly from Q4 2008 to Q1 2009. But that stress is not the only trend worth watching from a risk management perspective.

During the past several quarters, financial help line callers’ focus on short-term financial issues (debt and money management) has soared while their focus on long-term financial management (i.e., retirement planning) has plummeted. In fact, nearly nine out of 10 callers who asked questions about retirement investing wanted to know about changing their asset allocations in light of the pummeling their holdings have taken due to the economy.

Now, back to my question. more

To get the most from your IT investment, you have to establish and manage a relationship with each IT vendor. This isn’t as easy or straightforward as it sounds. And it certainly isn’t cheap. There is a relationship cost associated with every IT vendor you use.

Forrester Research goes so far as to suggest companies establish a vendor management office (VMO), which seems a little extreme. Forrester believes a VMO brings more maturity and process discipline to IT, allowing IT to take an activist approach to IT sourcing. Fair enough, but, to me the VMO is overkill, suggesting the project management office (PMO), infamous for its suffocating bureaucracy and project police.

Given that there is a cost associated with each IT vendor, the question arises, How many IT vendors are enough? One, three, a dozen, more? Many organizations have ten or more. Even those that claim to have standardized on a single vendor invariably have other vendors’ products, too. more