The Board of Directors is responsible for the overall risk governance process. Unfortunately, it is often easy to get caught up in the small details while missing the big picture for risk in a company. Boards need to guard against this by taking a broader view of risk in the context of strategic decision. Directors must learn to shift attention away from little details and focus on the larger picture of risk relating to the company’s overall strategy. ( NACD Report on Risk Governance: Balancing Risk and Reward October 2009)
In order to not miss any opportunity or possible threat, Boards need to be presented with several strategic alternatives with management’s assessment of different scenarios of risk and return. This can provide the board with invaluable first-hand insight into key risks the company is facing.