Given that there is no one-size-fits-all solution for risk and the risk management function, how risk is governed varies across industries and organizations. A fundamental role of the board of directors in discharging its risk oversight responsibilities is to ensure the success of the independent risk management function.

Has the board articulated its risk oversight objectives and evaluated the effectiveness of its processes in achieving those objectives? There are five interrelated principles that underlie effective risk management within all organizations, in both good times and bad. In this issue of Board Perspectives: Risk Oversight, we discuss these five fundamental principles to attaining risk management success.