Reflaction Essay Example | Topics and Well Written Essays - 250 words

Reflaction - Essay Example With an end goal to accomplish the exclusive expectations of manliness set by sexism and heterosexism the same, men miss the mark concerning taking part in hostile to viciousness endeavors (Grove 287). The postulation of the article is convincing given that it features the genuine idea of the general public, particularly with respect to men and hostile to savagery endeavors. While society anticipate that men should hold their manliness norms as high as could reasonably be expected, supporting endeavors against savagery turns into an overwhelming undertaking given that the two run corresponding with one another. It is very unimaginable for a man to stay manly in the eyes if the general public while simultaneously supporting endeavors against savagery. The article further presents potential procedures of drawing in men in hostile to viciousness endeavors, for example, connecting with men in exercises that challenge both sexism and heterosexism while giving them a section point that help their male character (Grove 285). The subsequent article lays accentuation on the formation of interchange network based mediation to brutality. The endeavors contributed by the current mediations to viciousness are not sufficient to alleviate the brutality to a passable level. It consequently proposes the making of network based intercessions as an answer for savagery. It refers to the absence of usage of elective systems on the ground as a significant issue confronting the battle against viciousness. The productivity of the network put together mediation to savagery lies with respect to drawing in the network in taking dynamic job in really interceding viciousness (Mimi 293). The elective intercession to savagery ends up being a successful method of moderating brutality given it moves toward the issue from the grass root notwithstanding really including the network with an end goal to battling viciousness. The procedures plot in network based intercession programs elevate odds of accomplishment of the mediation. The paper has edified me on elective intercession

Comparison between the father and son relationship in Antigone and The Wild Duck Essay Example For Students

Correlation between the dad and child relationship in Antigone and The Wild Duck Essay We picked those scenes as we feel that they mirror our postulation the best to depict the dad and child relationship of the characters in the two plays. In these scenes, the themes of the characters are first rate and likenesses and complexities between the two plays can be seen plainly. ANTIGONE * Complication * Happens because of Antigone proceeding with her arrangements; the fundamental activity of the play, Antigone reacts to the sensational affectation which is her decision of covering Polyneices In antigone, its all exceptionally angry. Creon and Haemon talk straightforwardly to one another, with no concealed importance to what they are stating. We chose to feature this by making their development dynamic. They move around a great deal and this along with the exchange they talk upgrades the effect of hwat they are stating as the development passes on how they feel. By setting the ensemble on the stage, we likewise show the unimportance of the melody and every other person as Haemon and Creon are profoundly engaged in their contention. It is as if they dont notice the nearness of the others with the exception of their own. We additionally choose to make them face to the crowd when they are stating explicit parts to show its significance, that the crowd needs to tune in as it passes on a significant message or good. Since Creon, as we definitely know isn't generally excellent with utilizing words to depict his feelings, we chose to pass on this part by making him physical. We see him nearly hitting Haemon and pushing him, and so on and this portrays the strain in their relationship as father and child. Likewise, in this concentrate we picked, Creon supposedly is increasingly better than Haemon. We show this by how he talks. Creaon talks stronger and takes standard stops in the middle of his sentences to show that he is more astute and progressively normal; as though he might suspect before he talks. He additionally has an unmistakable and exact inflection while articulating his words to feature his nobility as the lord and ruler. Haemon then again is depicted to be progressively delicate, despite the fact that he doesnt concur with Creon, he despite everything shows regard subsequently having a lower status than Creon. He talks with enthusiasm and has a gentler tone to his voice, as he really thinks about Creons prosperity (toward the beginning). In any case, as Creon begins debasing him, he begins to blow up and this particularly is featured when he prevents Creon from slapping him. THE WILD DUCK * Dramatic affectation * The entire play rotates around the discourse as it is the thing that that informs the crowd regarding what occurred before and it additionally depicts what kind of character Werle is. Everybody in the Ekdal family and Gregers is influenced somehow or another by Werle and we discover this association through this exchange. In wild duck its all very holing up behind exteriors and talking in allegories. To show this, we separate the discourse into brief delays, where during this time the on-screen character, chris (werle) does activities, for example, blending drinks. This is done to underline how they are being careful and mindful of what they are stating that they need to think about it before saying it. We additionally incorporated the utilization of props for the wild duck since we feel that the sound these item makes will upgrade the state of mind and air of the scene, to make it progressively sensible. Here, it is something contrary to Antigone as Gregers is depicted to be the character with more control. We show this through his development; Gregers consistently appear to move towards Werle, who gives off an impression of being progressively static. He typically just stands in a single position or sit. To show the strain in their relationship, Werle at one point puts his hand on Gregers shoulder h owever Gregers just disregards it as if saying Im not prepared to make pleasant with you. Gregers talk in a noisy way to depict his control over Werle. .ufd95558bd44caeb83b5b30fd372422ab , .ufd95558bd44caeb83b5b30fd372422ab .postImageUrl , .ufd95558bd44caeb83b5b30fd372422ab .focused content region { min-tallness: 80px; position: relative; } .ufd95558bd44caeb83b5b30fd372422ab , .ufd95558bd44caeb83b5b30fd372422ab:hover , .ufd95558bd44caeb83b5b30fd372422ab:visited , .ufd95558bd44caeb83b5b30fd372422ab:active { border:0!important; } .ufd95558bd44caeb83b5b30fd372422ab .clearfix:after { content: ; show: table; clear: both; } .ufd95558bd44caeb83b5b30fd372422ab { show: square; change: foundation shading 250ms; webkit-progress: foundation shading 250ms; width: 100%; darkness: 1; progress: obscurity 250ms; webkit-progress: haziness 250ms; foundation shading: #95A5A6; } .ufd95558bd44caeb83b5b30fd372422ab:active , .ufd95558bd44caeb83b5b30fd372422ab:hover { murkiness: 1; change: mistiness 250ms; webkit-change: haziness 250ms; foundation shading: #2C3E50; } .ufd95558bd44caeb83b5b30fd372422ab .focused content region { width: 100%; position: relativ e; } .ufd95558bd44caeb83b5b30fd372422ab .ctaText { outskirt base: 0 strong #fff; shading: #2980B9; text dimension: 16px; textual style weight: intense; edge: 0; cushioning: 0; text-enhancement: underline; } .ufd95558bd44caeb83b5b30fd372422ab .postTitle { shading: #FFFFFF; text dimension: 16px; text style weight: 600; edge: 0; cushioning: 0; width: 100%; } .ufd95558bd44caeb83b5b30fd372422ab .ctaButton { foundation shading: #7F8C8D!important; shading: #2980B9; fringe: none; fringe sweep: 3px; box-shadow: none; text dimension: 14px; text style weight: striking; line-stature: 26px; moz-fringe range: 3px; text-adjust: focus; text-enrichment: none; text-shadow: none; width: 80px; min-tallness: 80px; foundation: url(https://artscolumbia.org/wp-content/modules/intelly-related-posts/resources/pictures/straightforward arrow.png)no-rehash; position: supreme; right: 0; top: 0; } .ufd95558bd44caeb83b5b30fd372422ab:hover .ctaButton { foundation shading: #34495E!important; } .ufd95558bd44caeb83b5b 30fd372422ab .focused content { show: table; stature: 80px; cushioning left: 18px; top: 0; } .ufd95558bd44caeb83b5b30fd372422ab-content { show: table-cell; edge: 0; cushioning: 0; cushioning right: 108px; position: relative; vertical-adjust: center; width: 100%; } .ufd95558bd44caeb83b5b30fd372422ab:after { content: ; show: square; clear: both; } READ: Mrs Casper in the novel EssayPOINTS OF COMPARISON Likenesses * Gregers and Haemon both leave toward the finish of each area leaving is to some degree last * They are both blaming for need for judgment/botches * Lecture from fathers; how could you talk in that tone * Werle and Creon both aversion what their child needed to state/slight * Woman substitute in the two scenes Contrasts * Creon is dangerous and physical, and is clearly brutal and rough towards Haemon * Werle appears be utilized to such things from Gregers, anticipated conduct * Creon isn't utilized to Haemon berating him, so he goes absolutely bonkers * Haemons words clearly influenced Creon, according to his response yet Werle remains very quiet during the conversation, he is unaffected by all of Gregers words * Creon resorts to offending Haemon; Werle never truly answers straightforwardly to whatever Gregers state * Haemon leaves suddenly, and we know obviously why he leaves, yet we are not so much sure why Gregers leaves. Postulation In the two plays, the far off dad child connections depicted have prompted awful goals.

Marriot International, Inc. Analysis

This is an exploration put together task with respect to the worldwide development openings and practices of Marriot Hotels. Marriot International, Inc., which is situated in the U.S., is a worldwide administrator of a wide assortment of inns and other cordiality facilities.Advertising We will compose a custom paper test on Marriot International, Inc. Examination explicitly for you for just $16.05 $11/page Learn More The organization has around 3,150 housing and convenience offices situated in USA and numerous others in remote nations. With a wide assortment of self-marked properties over the world and select housing brands, Marriot is apparently positioned among the top heads of accommodation benefits on the planet. Guests’ settlement prerequisites are expanding bounteously with each new day, because of the changing condition brought by globalization, among different drivers. The expanding requests for restrictive housing and settlement offices encouraged by globalizations ha ve kept on calling for much worry from the accommodation segment. This for sure is one of the numerous prudent chances and advantages that have been brought by the pattern of globalization to the tremendous cordiality industry. Alongside the expanding dwelling requests, the pattern has additionally carried incredible effect on other main thrusts in the cordiality business, in a way that contacts pretty much every division of the business (Rusa, van Knippenberg Dan 13) These effects have kept on influencing decidedly, all tasks in the segment, such that builds interest for accommodation items and administrations, in this manner constraining numerous organizations in the business to take their business across national limits. Among those organizations that have had the option to embrace to the numerous adjustments in the division, and who have been hopeful enough to see opportunity in all of new turns of events, are the Marriot International, Inc., who have effectively opened accommod ation chains in practically all pieces of the world. One of the company’s significant objective and target is to continue with its crucial giving elite projects and assets that do mirror the worldwide networks. This surely clarifies the company’s current worldwide decent variety and incorporation to pretty much all aspects of the world, particularly in the creating countries.Advertising Looking for article on business financial matters? We should check whether we can support you! Get your first paper with 15% OFF Learn More As it would be watched, there are numerous difficulties in the present friendliness industry, yet Marriot’s hopeful methodology would empower to them see opportunity in those difficulties and use them completely, as one method of guaranteeing that they stay ahead in the serious commercial center. The accompanying diagram shows Marriot’s shares in the market, contrasted and different organizations in the accommodation segment. Since the time the company’s establishment by Willard Marriot path back in the year 1927, it has experienced quick improvements over the time. Today, the organization is pleased with around 3,200 housing properties comprehensively, with an aggregate of 435 inn offices outside USA. In spite of the numerous difficulties at present pervading the worldwide neighborliness industry, Marriot are yet to feel the warmth, because of their suffering administration reasoning and centered initiative capacities. Marriot International has effectively figured out how to convey its neighborliness brands into numerous locales of the world. This pattern proceeds even today, as the organization guides its extension plans to other creating districts, where they are yet to make a passageway (Ulrich 81). Notwithstanding, regardless of these worldwide extension endeavors which reflects achievement and quality in the worldwide market, Marriot Hotels have never been fortunate to evade a portion of the numerous business challenges influencing the cordiality segment today. As it is watched, budgetary, conservative and social difficulties are a portion of the major worldwide difficulties which keep on influencing the company’s extension efforts.Advertising We will compose a custom exposition test on Marriot International, Inc. Examination explicitly for you for just $16.05 $11/page Learn More Cultural Challenges The social contrasts introduced by different social gatherings have been a significant test to the organization. Various nations have distinctive social discernments, and in some cases, these changed societies may not offer a smooth greeting to numerous cordiality ventures adjusted to Marriot’s worldwide decent variety and consideration plan. A few people in those various locales may will in general observe the company’s strategies, gauges, brands, administrations, and offers as a danger to their own way of life. Hence, these networks may not be prepared to barg ain their own particular manner of life for a remote speculator, since they have a worldwide notoriety in the friendliness division. For example, the company’s ongoing non-smoking strategy inside their housing offices, despite the fact that moral, may not function admirably in many spots where smoking is completely acknowledged. Nonetheless, as it would be seen from past investigations, Marriot Hotels have consistently conceived new systems to address the issue of culture, which ends up being basic in numerous outside nations. One viable method of tending to social difficulties and issues has experienced the soul of decent variety, which guarantees that the company’s colossal workforce is drawn from different areas speaking to an assorted variety of culture. The company’s stirred up workforce truly mirrors the rich decent variety of the networks in the whole world, where the organization has a touch. Conservative Challenges No one in this world, not even the sha rpest money related examiners can foresee the problem that anticipates the worldwide business segment sooner rather than later. This is because of the progressing ramifications of the past money related emergencies and turbulences. Numerous organizations on the planet have never been steady with their organizations, inferable from the numerous difficulties presented by the questionable examples of the economy. Organizations everywhere throughout the world are progressively recovering endurance in the market, as the worldwide economy keeps on balancing out from the effect of the ongoing money related emergency, yet with a great deal of difficulties (Boyd 42). Be that as it may, a few organizations in the worldwide market, for example, Marriot International who have had a solid money related soundness have never been not kidding casualties of these monetary turbulences and have cruised all through with their activities in the friendliness segment, even at the pinnacle of the most exce edingly awful conservative occasions ever. This anyway doesn't imply that Marriot International has never felt the touch of current worldwide efficient challenges.Advertising Searching for paper on business financial matters? How about we check whether we can support you! Get your first paper with 15% OFF Find out More At whatever point worldwide practical turbulences do happen, they influence each division of our economy, either straightforwardly or legitimately. For this situation, one path by which Marriot keeps on paying the expense of affordable difficulties is through its universal development endeavors. While it is difficult to set up new properties in certain nations in the current conservative circumstances, it has never been simple for the organization to deal with its property and offices in certain locales where the ramifications of the 2007 worldwide emergency are yet to die down totally. All things considered, the organization has no other decision, yet to apply helpful administration ideas which are sure to empower them endure the numerous difficulties routinely introduced by the questionable practical examples of the day. One of the most relevant ideas utilized by Marriot to manage this test is the modification of costs to coordinate the efficient changes. The accompanying graph sho ws the normal cost of a room for every year for the organization in various efficient occasions. Money related Challenges Financial test stays a significant deterrent in the extension of the cordiality area. Marriot International, despite the fact that a major player in the area, has never been barred from this test. Customers’ needs are getting unpredictable with each second that passes, driven by the present data age (Palierse 17). In such manner, clients are outfitted with more data in regards to elite administrations and items that they would expect in an organization having a worldwide acknowledgment, for example, Marriot. To react to these requests, Marriot has normally been compelled to leave behind a great deal of cash to keep up its selective cordiality brands and property, as one method of holding their notoriety in the business. Be that as it may, attempting to adjust the company’s immense tasks with its worldwide notoriety has consistently been an expensive intercession which has kept on freezing the organization of a great deal of cash, in each budgetary year. This postures extraordinary difficulties to the company’s late development endeavors to other pending areas. It is additionally evident that the money related execution of the company’s properties isn't the equivalent in all districts. While the economies of some individual countries keep on assuming a bigger job in the company’s monetary achievement, things are not all that lovely in different districts. This has the implying that, Marriot has gone through more cash in the administration of its properties in certain districts, while the estimation of these ventures is never encouraging now and again. Another genuine and regular money related test confronting the organization in its development endeavors is the issue of business condition in different parts. In some quick creating areas, for example, India, land is over the top expensive and this makes it d ifficult for the organization to build up new property there, inferable from the genuine administration and operational difficulties this is probably going to posture to the business later on. Works Cited Boyd, David. â€Å"Lessons from turnaround leaders.† Strategy Leadership 39. 3 (2011): 36-43. Print. Palierse, Christophe. â€Å"L’amà ©ricain Marriott veut implanter un hã'tel Bulgari à Paris.† Les Echos 31. 12 (2011): 17. Pri

Changing Business Environment Toyota

Question: Examine about theChanging Business Environment for Toyota. Answer: Presentation: The accompanying report will examine the changing business condition in China. The report includes the business contextual analysis of Toyota. Business condition establishes of the mechanical variables, initiative components, business procedures and the human asset factors. These are the inside business situations that give the bbu8sinmess hierarchical achievement. Then again there are outer elements of the business conditions too. The outer business condition alludes to the administration approaches that influence the business procedure of an association of a nation. Outside business condition additionally involves the legitimate issues the monetary state of a nation or a specific spot that puts its effect upon the business associations. As indicated by the researcher, generally market and creation strategy relies upon how the associations embrace the inner and outer components. The picked contextual investigation manages the difference in the business condition so as to get change the activities procedure. Since, no organization can change the outside business condition, the inner situations should be engaged and change ought to be gotten need (Prajogo, 2016). Preparation of the Company: The historical backdrop of Toyota goes back to 1800s. Sakichi Toyoda, who had a place from a remote network outside Nagoya has established the framework stone on the organization. He began by helping his dad in carpentry. He has uncommon enthusiasm for making wooden turning machines. The limit of Sakichi Toyoda could be seen since his young age. In the year, 1894, he made manual weaving machines were less expensive than the weaving machines were accessible typically. The possibility of development was likewise introduced in Sakichi Toyoda. To facilitate the trouble of his mom and grandma, he enhanced the force driven wooden weavers. He further dealt with the weaving machines offer ascent to increasingly complex weavers. The advancement of Sakichi Toyoda isn't just about growing new things yet in addition spare vitality and wastage. He designed an instrument that will stop a loom the second a string will be broken. In this manner, Sakichi Toyoda had the option to make his essence felt with the craft of loom making. His child, Kiichiro Toyoda, further completed the inheritance of Sakichi Toyoda. The possibility of Just-In-Time was the brainchild of Kiichiro Toyoda. The possibility of Kiichiro Toyoda has roused numerous other vehicle organizations and one of them is Ford. The fundamental thought of Kiichiro Toyoda was propelled by the retail market of the United States. The general stores of the United States supplanted the items the second the clients purchased the items. Toyota is one of the biggest vehicle producing organizations on the planet. It doesn't just produces and structures the vehicles different vehicles for the working class clients yet in addition offers the clients sumptuous vehicles with significant expense. The creation period of Toyota has been ordered into various fragments:- the pinnacle period of vehicle creation just as the lean period of the vehicle creation. The creation procedure relies upon the market request. Nonetheless, investigation of legitimate market request involves the prerequisite of the activities, for example, flexibly chain, creation, plan, showcasing and deals. Assembling and propelling new brands needs the market enthusiasm in order to make showcase chance to various market portion. The market section has various stages as indicated by the accessibility of vehicles and administration input. In the vast majority of the cases, Toyota has looked for after the adjustment in the business condition so as to improve the method of business activities. Toyota, the Japanese autos maker has embraced distinctive change techniques in order to affirm the selection (Woo Song, 2013) Creation System: Toyota has created Toyota Production System after the World War II the impact of World War was very serious in the creation strategy and business arrangements of the association. The organization began with business stock technique and the progression of the business contained the whole development of the vehicles and the model planning of the vehicles. China as a worldwide market and worldwide assembling country has now developed as one of the most significant market and assembling areas on the planet. After the modern blast during the 90s and the early long periods of the 21st century, china has been at the top of the line list (Santoro, 2015). Toyota has arranged the assembling procedure in such a way along these lines, that they can serve the clients when the need is high. They began fabricating trucks after world war II as they were expected to assemble Japan. At first, they confronted issues because of the downturn of the economy however the organization step by step picked up force after the conditions showed signs of improvement. The organization confronted further issues as the economy was not steady. Because of swelling, the circumstance of Toyota declined. They began different cost-cutting approaches. The remembered intentional cut for the compensation for the directors and 10% cut in the compensation for all the representatives in the association. Likewise, they have requested that 1600 laborers resign intentional. The abrupt cost cutting in the association has begun numerous issues among the representatives and the organization has seen open exhibition among laborers. The matter of Toyota has developed an incredible arrangement for the most part as a result of its smart creation framework. They produce various comparable vehicles in a similar gathering lin. It causes them to fulfill the clients as well as encourages them to keep lead times short and keep the creation adaptable. Hence, on the off chance that they keep the creation in a similar mechanical production system, they can cling to the requirements and needs of the clients and change things without any problem. The creation cost will likewise be brought down as there would not be a lot of progress in the activities. They have thought of bringing down the waste. They focus on large scale manufacturing with the goal that the measure of waste for every unit will be brought down. The complete creation framework received by Toyota has halted the thought that on the off chance that a machine isn't working, at that point it isn't bringing in cash. Another maxim of Toyota is to be the best. At the point when they are building the all out creation framework, they have thought of giving the best to the client and designated the best laborers. They are not falling behind most definitely. They request that their representatives take care of the issues themselves so they will have the option to settle progressively troublesome issues themselves. The workers of Toyota are associated with designing, deals and administration, keep up human asset and do bookkeeping so they can fulfill the clients. Change Environment Factors in China: The adjustment in the business condition has as of late been perceived in the start of the twenty first century. Since the vast majority of the interior condition factors are exceptionally subjective and controllable, the associations in the Chinese enterprises of various perspective have been making a decent attempt to bring the necessary change while making the space for the tasks. New research from China European International Business School uncovered that a large portion of the outside organizations set up in China have been adjusting new business situations in the inner tasks. According to the yearly business overview in China by CEIBS, Chinese business condition has been profoundly affected by in excess of 440 outside organizations (Lu et al., 2014). One of the eminent changes in the Chinese business condition has been the climb of work cost. In spite of the fact that the nation delighted in extreme modest work throughout the years, the developing expense of work has influenced the whole procedure of creation in assembling ventures and administration in the tertiary division. Inspite of the ongoing droop, UBS has estimate that Chinese economy would develop by a striking 7.8 % in 2016. Being the monetary goliath on the planet business, China has received a few changes as the economy and between hierarchical exhibitions. The monetary real factors adjusted by the Chinese industrialists have been profoundly viable in the business procedure vital arranging. Difficulties of Changing Business Environment in China: Despite the fact that the progressions have been invited by the Chinese agents as wel as the industrialists in various levels, there are scarcely any moves that should be confronted and settled during the business procedure. Ascend in the work cost has at first caused compelling change in the creation. So far the cars and vehicle fabricating is concerned, the changing business economy and work showcase has confined free stream creation in the Chinese business. After the worldwide financial emergency in 2008-2009, China has built up its own monetary framework so as to facilitate the business conditions. This has driven the nation to the development of 7% expansion in its economy. The propelled showcase situated economy by the administration of China has encouraged a great many laborer consequently promising the inclusion of able workers. It has likewise equipped the whole procedure of creation. After 2009, the organizations have misused the plenitude of the works and it has additional ly quickened the dexterity of creation and market execution. After 2007, Chinese the Chinese GDP grew up to 6%. This has been the verification of the positive business change in Chinese market. Achieve of the Change: The change accounted in the matter of the Chinese market has likewise caused the business level development that has been sure in the ongoing years. Then again the procedure of the Chinese market and assembling industry have been adjusting the most current changed therefore mirroring their method of execution the organizations need to rehearse. The contextual investigation has been useful in the all out business the executives. End: Change in the business the executives has been useful in understanding two of the more prominent angles the money related change the board and human asset improvement the board. Both of these business undertakings have been exceptionally influenced by the adjustment in the

First Week of College Free Essays

Brad Campagna Kathy O’Rourke College has so far surpassed my desires in an enormous manner. As another individual from the ice hockey group there were numerous vulnerabilities and stresses, just as huge amounts of fervors and expectations. Clearly the greatest part, school, was nerve wracking and energizing as well. We will compose a custom paper test on First Week of College or on the other hand any comparable subject just for you Request Now In school hockey its basic that players remove a couple of years from school before joining in, to play hockey in junior hockey classes. This made more nerves then energy for the homeroom part of school since i’ve just taken 3 school courses since graduating secondary school, making it somewhat harder to get once again into the swing of things. Other than getting once again into school schedule, being a hockey player in school has made the start of school a mind boggling experience for me. On move-in day while still during the time spent packing it all up, my flat mate and I met the principal player in our group. Since my flat mate is likewise in my group it was a tremendous help to meet somebody before our folks even left. From that point forward it’s been going great and have made number of companions in the group, numerous which I definitely realize sick be awesome companions with later on. This was most likely the greatest alleviation for me so far in light of the fact that I had no clue what's in store. I continued stressing over how the children, particularly the newcomers, would be and actually every one is a magnificent individual. I didn’t acknowledge what amount being on a games group would assist me with making companions this quick, which I am amazingly appreciative for. We’ve all had a fabulous time as of now and we are only multi week into school. On the entirety of that, we are all in any event 20 years of age and up as green bean. I think this gives us a major bit of leeway of change for things like school since we are all in any event two years increasingly develop then we would have on the off chance that we had gone right from secondary school. Presently that isn't to toot my or any of my companions horns, yet I do feel as though the development level is unquestionably higher then it would have been by the general way we convey and present ourselves instead of being 17 or 18. On the off chance that the year is going to proceed on like this, I can just envision how much fun it’s going to be. This is likewise all abandoning referencing the hockey part. Hockey hasn’t even began at this point which energizes me considerably more. I think and expectation we have a generally excellent group that can do very well all through the season. Presently clearly school isn’t all silly buffoonery. The school part of school hasn’t truly soaked in yet since were not exceptionally far into the semester. It unquestionably concerns me to some degree, however I figure I will wind up progressing admirably. I normally have a decent hard working attitude through hockey, so I plan on utilizing that into the homeroom. Sure it will be more enthusiastically here and there on account of practices and games and so forth, yet that is the thing that my colleagues and the remainder of the lodging that Potsdam supplies for us are for. It’s a decent beginning for me educator astute, since basically every one of them appear to be generally excellent at what they do. The main thing that has gotten me somewhat irritated and restless about is all the perusing. Perusing occupies a ton of time and that what the vast majority of school is. My time the board should be productive if I’m going to do well this year. I trust my next four years here will simply continue showing signs of improvement and better as I meet new individuals and investigate new things. There is still so much I haven’t done at this point thus numerous encounters I need to look forward also as long as my school stirs keeps awake to standard. At the point when my vocation at Potsdam is over I trust I will have achieved my objective of exceeding expectations all around whether its school, hockey, companions, network status and the sky is the limit from there. Clearly I plan on having my degree whether I proceed with my Business major or change to something different. I expectation and hope to have passing marks all through the entire experience not simply getting by. I additionally hope to do very well in hockey and would like to have a quick effect in the group and bring it out through the entire four years here. I likewise would like to have my companions that I’ve previously made be my closest companions and companions for a mind-blowing remainder. At last when I leave Potsdam I would like to have bigly affected the general network. The hockey group focuses on a high significance of being dynamic in the network and having an inspirational disposition in each spot in each circumstance. So far there’s been a lot of inspiration here and I will be adding to that however much as could reasonably be expected. In the event that my entire time at Potsdam will be the means by which this first week has been, at that point I envision having a very decent encounter here. Instructions to refer to First Week of College, Papers

Mindfulness Meditation for Panic Disorder

Mindfulness Meditation for Panic Disorder Panic Disorder Coping Print Mindfulness Meditation for Panic Disorder By Katharina Star, PhD facebook linkedin Katharina Star, PhD, is an expert on anxiety and panic disorder. Dr. Star is a professional counselor, and she is trained in creative art therapies and mindfulness. Learn about our editorial policy Katharina Star, PhD Medically reviewed by Medically reviewed by Steven Gans, MD on August 05, 2016 Steven Gans, MD is board-certified in psychiatry and is an active supervisor, teacher, and mentor at Massachusetts General Hospital. Learn about our Medical Review Board Steven Gans, MD Updated on November 29, 2019 Mindfulness meditation. Getty Images Credit: PeopleImages More in Panic Disorder Coping Symptoms Diagnosis Treatment Related Conditions People with anxiety disorders are often prone to frequent worrying, feelings of nervousness, and negative thinking. For example, many people with panic disorder spend time worrying about the future  or stressing about the past. Fortunately, relaxation techniques can help counteract these symptoms. Relaxation techniques are practices you can learn on your own, or with the guidance of a professional. These activities are aimed at assisting you in slowing down your thoughts, letting go of stress  and opening up to deep relaxation. Such techniques can help counteract many of the cognitive and physical symptoms of panic disorder and anxiety. Common relaxation techniques include deep breathing, yoga, visualization, massage, and progressive muscle relaxation (PMR). Mindfulness meditation is another common relaxation skill that can assist with stress and anxiety reduction. Relaxation Techniques for Help With Anxiety Disorders What Is Mindfulness Meditation? Mindfulness meditation is a relaxation technique that brings your awareness back to the present. During mindfulness practice, the meditator allows thoughts to arise without trying to stop or judge them. For example, unpleasant thoughts related to fear, judgment, blame, and worry may come up. Mindfulness is the act of acknowledging these thoughts  and allowing them to pass. Mindfulness meditation is based on the idea that most people push away or ignore their present thoughts and feelings. Many believe that if they ignore negative thoughts, those thoughts will simply go away. But mindfulness actually allows you to detach from negative thinking by facing thoughts without reaction. By letting uncomfortable thoughts pass without reacting, you can develop a new response to fear and anxiety. Over time, and with practice, mindfulness meditation can help create inner harmony, clarity, and peace. Mindfulness Meditation: How Do I Do It? Getting Started When you first begin to practice mindfulness meditation, it may be helpful to do so in a quiet, distraction-free area. The time of day you decide to meditate can be determined by your particular needs. For instance, some people prefer to start the day off with meditation, reducing morning anxiety and setting a clear and positive tone for the day. Others prefer to meditate at night, letting go of the stress of the day, and preparing for a good night’s rest. How to Start Meditating Try to set aside at least five to 10 minutes to sit in meditation, gradually increasing the duration as you become more comfortable with your practice.Start off sitting or lying down in a comfortable position.Close your eyes and begin your meditation with a breathing exercise.Next, simply notice your thoughts, allowing any ideas to come to your mind.Keep a nonjudgmental attitude as you let yourself remain in the present with your inner voice.When your meditation feels complete, take a few deep breaths and open your eyes. How to Sit When Learning to Meditate A Word From Verywell Mindfulness meditation may sound simple enough, but even routine meditators find it difficult from time to time. In fact, many people experience heightened anxiety when they first sit down to meditate. Motivation and desire may also wane from day to day, so try to be patient with yourself and your meditation practice. If you stick with your meditation practice, you will learn to sit with uncomfortable thoughts. Only through regular practice will mindfulness meditation become less challenging, help you to lower anxiety, and bring you a sense of inner peace. 6 Ways to Fit Your Meditation Practice Into Your Day

Corporate Governance Lessons from the Financial Crisis - Free Essay Example

The Corporate Governance Lessons from the Financial Crisis Grant Kirkpatrick * This report analyses the impact of failures and weaknesses in corporate governance on the financial crisis, including risk management systems and executive salaries. It concludes that the financial crisis can be to an important extent attributed to failures and weaknesses in corporate governance arrangements which did not serve their purpose to safeguard against excessive risk taking in a number of financial services companies. Accounting standards and regulatory requirements have also proved insufficient in some areas. Last but not least, remuneration systems have in a number of cases not been closely related to the strategy and risk appetite of the company and its longer term interests. The article also suggests that the importance of qualified board oversight and robust risk management is not limited to financial institutions. The remuneration of boards and senior management also remains a highly controversial issue in many OECD countries. The current turmoil suggests a need for the OECD to re-examine the adequacy of its corporate governance principles in these key areas. * This report is published on the responsibility of the OECD Steering Group on Corporate Governance which agreed the report on 11 February 2009. The Secretariat’s draft report was prepared for the Steering Group by Grant Kirkpatrick under the supervision of Mats Isaksson. Main conclusions The financial crisis can be to an important extent attributed to failures and weaknesses in corporate governance arrangements This article concludes that the financial crisis can be to an important extent attributed to failures and weaknesses in corporate governance arrangements. When they were put to a test, corporate governance routines did not serve their purpose to safeguard against excessive risk taking in a number of financial services companies. A number of weaknesses have been pparent. The risk management systems have failed in many cases due to corporate governance procedures rather than the inadequacy of computer models alone: information about exposures in a number of cases did not reach the board and even senior levels of management, while risk management was often activity rather than enterprise-based. These are board responsibilities. In other cases, boards had approved strategy but then did not establish suitable metrics to monitor its implementation. Company disclosures about foreseeable risk factors and about the systems in place for monitoring and managing risk have also left a lot to be desired even though this is a key element of the Principles. Accounting standards and regulatory requirements have also proved insufficient in some areas leading the relevant standard setters to undertake a review. Last but not least, remuneration systems have in a number of cases not been closely related to the strategy and risk appetite of the company and its longer term interests. Qualified board oversight and robust risk management is important The Article also suggests that the importance of qualified board oversight, and robust risk management including reference to widely accepted standards is not limited to financial institutions. It is also an essential, but often neglected, governance aspect in large, complex nonfinancial companies. Potential weaknesses in board composition and competence have been apparent for some time and widely debated. The remuneration of boards and senior management also remains a highly controversial issue in many OECD countries. The OECD Corporate Governance Principles in these key areas need to be reviewed The current turmoil suggests a need for the OECD, through the Steering Group on Corporate Governance, to re-examine the adequacy of its corporate governance principles in these key areas in order to judge whether additional guidance and/or clarification is needed. In some cases, implementation might be lacking and documentation about the existing situation and the likely causes would be important. There might also be a need to revise some advice and examples contained in the OECD Methodology or Assessing the Implementation of the OECD principles of Corporate Governance I. Introduction Corporate governance enhancements often followed failures that highlighted areas of particular concern The development and refinement of corporate governance standards has often followed the occurrence of corporate governance failures that have highlighted areas of particular concern. The burst of the high tech bubble in the late 1990s pointed to severe conflicts of interest by brokers and analysts, underpinning the introduction of principle V. F covering the provision of advice and analysis into the Principles. The Enron/Worldcom failures pointed to issues with respect to auditor and audit committee independence and to deficiencies in accounting standards now covered by principles V. C, V. B, V. D. The approach was not that these were problems associated with energy traders or telecommunications firms, but that they were systemic. The Parmalat and Ahold cases in Europe also provided important corporate governance lessons leading to actions by international regulatory institutions such as IOSCO and by national authorities. In the above cases, corporate governance deficiencies may not have been causal in a strict sense. Rather, they facilitated or did not prevent practices that resulted in poor performance. It is therefore natural for the Steering Group to examine the situation in the banking sector and assess the main lessons for corporate governance in general The current turmoil in financial institutions is sometimes described as the most serious financial crisis since the Great Depression. It is therefore natural for the Steering Group to examine the situation in the banking sector and assess the main lessons for corporate governance in general. This article points to significant failures of risk management systems in some major financial institutions1 made worse by incentive systems that encouraged and rewarded high levels of risk taking. Since reviewing and guiding risk policy is a key function of the board, these deficiencies point to ineffective board oversight (principle VI. D). These concerns are also relevant for non-financial companies. In addition, disclosure and accounting standards (principle V. B) and the credit rating process (principle V. F) have also contributed to poor corporate governance outcomes in the financial services sector, although they may be of lesser relevance for other companies. The article examines macroeconomic and structural conditions and shortcomings in corporate governance at the company level The first part of the article presents a thumbnail sketch of the macroeconomic and structural conditions that confronted banks and their corporate governance arrangements in the years leading up to 2007/2008. The second part draws together what is known from company investigations, parliamentary enquiries and international and other regulatory reports about corporate governance issues at the company level which were closely related to how they handled the situation. It first examines shortcomings in risk management and incentive structures, and then considers the responsibility of the board and why its oversight appears to have failed in a number of cases. Other aspects of the corporate governance framework that contributed to the failures are discussed in the third section. They include credit rating agencies, accounting standards and regulatory issues. II. Background to the present situation Crisis in the subprime market in the US, and the associated liquidity squeeze, was having a major impact on financial institutions and banks in many countries By mid 2008, it was clear that the crisis in the subprime market in the US, and the associated liquidity squeeze, was having a major impact on financial institutions and banks in many countries. Bear Stearns had been taken over by JPMorgan with the support of the Federal Reserve Bank of New York, and inancial institutions in both the US (e. g. Citibank, Merrill Lynch) and in Europe (UBS, Credit Suisse, RBS, HBOS, Barclays, Fortis, Societe Generale) were continuing to raise a significant volume of additional capital to finance, inter alia, major realised losses on assets, diluting in a number of cases existing shareholders. Freddie Mac and Fanny Mae, two government sponsored enterprises that function as import ant intermediaries in the US secondary mortgage market, had to be taken into government conservatorship when it appeared that their capital position was weaker than expected. In the UK, there had been a run on Northern Rock, the first in 150 years, ending in the bank being nationalised, and in the US IndyMac Bancorp was taken over by the deposit insurance system. In Germany, two state owned banks (IKB and Sachsenbank) had been rescued, following crises in two other state banks several years previously (Berlinerbank and WestLB). The crisis intensified in the third quarter of 2008 with a number of collapses (especially Lehman Brothers) and a generalised loss of confidence that hit all financial institutions. As a result, several banks failed in Europe and the US while others received government recapitalisation towards the end of 2008. Understanding the market situation that confronted financial institutions is essential The issue for this article is not the macroeconomic drivers of this situation that have been well documented elsewhere (e. g. IOSCO, 2008, Blundell-Wignall, 2007) but to understand the market situation that confronted financial institutions over the past decade and in which their business models and corporate governance arrangements had to function. There was both a macroeconomic and microeconomic dimension. From the macroeconomic perspective, monetary policy in major countries was expansive after 2000 with the result that interest rates fell as did risk premia. Asset price booms followed in many countries, particularly in the housing sector where lending expanded rapidly. With interest rates low, investors were encouraged to search for yield to the relative neglect of risk which, it was widely believed, had been spread throughout the financial system via new financial instruments. Default rates on US subprime mortgages began to rise as of 2006, and warnings were issued by a number of official institutions It is important for the following sections of this article to note that default rates on subprime mortgages in the US began to rise in 2006 when the growth of house prices started to slow and some interest rates for home owners were reset to higher levels from low initial rates (â€Å"teaser† rates). Moreover, at the end of 2006 and at the beginning of 2007, warnings were issued by a number of institutions including the IMF, BIS, OECD, Bank of England and the FSA with mixed reactions by financial institutions. The most well known reaction concerned Chuck Prince, CEO of Citibank, who noted with respect to concerns about â€Å"froth† in the leveraged loan market in mid 2007 that â€Å"while the music is playing, you have to dance† (i. e. maintain short term market share). The directors of Northern Rock acknowledged to the parliamentary committee of inquiry that they had read the UK’s FSA warnings in early 2007 about liquidity risk, but considered that their model of raising short term finance in different countries was sound. By mid-2007 credit spreads began to increase and first significant downgrades were announced, while subprime exposure was questioned In June 2007, credit spreads in some of the world’s major financial markets began to increase and the first wave of significant downgrades was announced by the major credit rating agencies. By August 2007, it was clear that at least a large part of this new risk aversion stemmed from concerns about the subprime home mortgage market in the US3 and questions about the degree to which many institutional investors were exposed to potential losses through their investments in residential mortgage backed securities (RMBS), †¢ecuritized†¢ed debt obligations (CDO) and other †¢ecuritized and structured finance instruments. Financial institutions faced challenging competitive conditions but also an Accommodating regulatory environment At the microeconomic or market environment level, managements of financial institutions and boards faced challenging competitive conditions but also an accommodating regulatory environment. With competition strong and non-financial companies enjoying access to other sources of finance for their, in any case, reduced needs, margins in traditional banking were compressed forcing banks to develop new sources of revenue. One way was by moving into the creation of new financial assets (such as CDO’s) and thereby the generation of fee income and proprietary trading opportunities. Some also moved increasingly into housing finance driven by exuberant markets4. The regulatory framework and accounting standards (as well as strong investor demand) encouraged them not to hold such assets on their balance sheet but to adopt an â€Å"originate to distribute† model. Under the Basel I regulatory framework, maintaining mortgages on the balance sheet would have required increased regulatory capital and thereby a lower rate of return on shareholder funds relative to a competitor which had moved such assets off balance sheet. Some of the financial assets were marketed through off-balance sheet entities (Blundell-Wignall, 2007) that were permitted by accounting standards, with the same effect to economise on bank’s capital. III. The corporate governance dimension While the post-2000 environment demanded the most out of corporate governance arrangements, evidence points to severe weaknesses The post-2000 market and macroeconomic environment demanded the most out of corporate governance arrangements: boards had to be clear about the strategy and risk appetite of the company and to respond in a timely manner, requiring efficient reporting systems. They also needed to oversee risk management and remuneration systems compatible with their objectives and risk appetite. However, the evidence cited in the following part points to severe weaknesses in what were broadly considered to be sophisticated institutions. The type of risk management that was needed is also related to the incentive structure in a company. There appears to have been in many cases a severe mismatch between the incentive system, risk management and internal control systems. The available evidence also suggests some potential reasons for the failures. Risk management: accepted by all, but the recent track record is poor Risk models failed due to technical assumptions, but the corporate governance dimension of the problem was how their information was used in the organization The focus of this section about risk management does not relate to the technical side of risk management but to the behavioural or corporate governance aspect. Arguably the risk models used by financial institutions and by investors failed due to a number of technical assumptions including that the player in question is only a small player in the market. 5 The same also applies to stress testing. While this is of concern for financial market regulators and for those in charge of implementing Pillar I of Basel II, it is not a corporate governance question. The corporate governance dimension is how such information was used in the organisation including transmission to the board. Although the Principles do make risk management an oversight duty of the board, the internal management issues highlighted in this section get less explicit treatment. Principle VI. D. 2 lists a function of the board to be â€Å"monitoring the effectiveness of the company’s management practices and making changes as needed†. The annotations are easily overlooked but are highly relevant: monitoring of governance by the board also includes continuous review of the internal structure of the company to ensure that there are clear lines of accountability for management throughout the organisation. This more internal management aspect of the Principles might not have received the attention it deserves in Codes and in practice as the cases below indicate. Attention has focused on internal controls related to financial reporting, but not enough on the broader context of risk management Attention in recent years has focused on internal controls related to financial reporting and on the need to have external checks and reporting such as along the lines of Sarbanes Oxley Section 404. 6 It needs to be stressed, however, that internal control is at best only a subset of risk management and the broader context, which is a key concern for corporate governance, might not have received the attention that it deserved, despite the fact that enterprise risk management frameworks are already in use (for an example, see Box 1). The Principles might need to be clearer on this point. Box 1. An enterprise risk management framework In 2004, COSO defined Enterprise Risk Management (ERM) as â€Å"a process, effected by an entity’s board of directors, management and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may affect the entity, and manage risk to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives†. ERM can be visualised in three dimensions: objectives; the totality of the enterprise and; the framework. Objectives are defined as strategic, operations such as effective and efficient resource use, reporting including its reliability, and compliance with applicable laws and regulations. These will apply at the enterprise level, division, business unit and subsidiary level. The ERM framework comprises eight components: 1. Internal environment: it encompasses the tone of an organisation, and sets the basis for how risk is viewed and addressed by an entity’s people 2. Objective setting: objectives must exist before management can identify potential events affecting their achievement 3. Event identification: internal and external events affecting achievement of an entity’s objectives must be identified, distinguishing between risks and opportunities 4. Risk assessment: risks are analysed, considering likelihood and impact, as a basis for determining how they should be managed . Risk response: management selects risk responses developing a set of actions to align risks with the entity’s risk tolerances and its risk appetite 6. Control activities: policies and procedures are established and implemented to help ensure the risk responses are effectively carried out 7. Information and communication: relevant information is identified, captured, and communicated throughout the organisation in a form and timeframe that enable people to carry out their responsibilities 8. Monitoring: the entirety of enterprise risk management is monitored and modifications made as necessary Source: Committee of Sponsoring Organisations of the Treadway Commission. The financial turmoil has revealed severe shortcomings in risk management practices†¦ Despite the importance given to risk management by regulators and corporate governance principles, the financial turmoil has revealed severe shortcomings in practices both in internal management and in the role of the board in overseeing risk management systems at a number of banks. While nearly all of the 11 major banks reviewed by the Senior Supervisors Group (2008) failed to anticipate fully the severity and nature of recent market stress, there was a marked difference in how they were affected determined in great measure by their senior management structure and the nature of their risk management system, both of which should have been overseen by boards. Indeed, some major banks were able to identify the sources of significant risk as early as mid 2006 (i. e. when the housing market in the US started to correct and sub-prime defaults rose) and to take measures to mitigate the risk. The Group reviewed firm’s practices to evaluate what worked and what did not, drawing the following conclusions: CDO exposure far exceeded the firms understanding of the inherent risks †¢ In dealing with losses through to the end of 2007, the report noted that some firms made strategic decisions to retain large exposures to super senior tranches of collateralised debt obligations that far exceeded the firms understanding of the risks inherent in such instruments, and failed to take appropriate steps to control or mitigate those risks (see Box 2). As noted below, in a number of cases boards were not aware of such strategic decisions and had not put control mechanisms in place to oversee their risk appetite, a board responsibility. In other cases, the boards might have concurred. An SEC report noted that â€Å"Bear Stearns’ concentration of mortgage securities was increasing for several years and was beyond its internal limits, and that a portion of Bear Stearns’ mortgage securities (e. g. adjustable rate mortgages) represented a significant concentration of mortgage risk†(SEC 2008b page ix). At HBOS the board was certainly aware despite a warning from the FSA in 2004 that key parts of the HBOS Group were posing medium of high risks to maintaining market confidence and protecting customers (Moore Report). Understanding and control over potential balance sheet growth and liquidity needs was Limited †¢ Some firms had limited understanding and control over their potential balance sheet growth and liquidity needs. They failed to price properly the risk that exposures to certain off-balance sheet vehicles might need to be funded on the balance sheet precisely when it became difficult or expensive to raise such funds externally. Some boards had not put in place mechanisms to monitor the implementation of strategic decisions such as balance sheet growth. A comprehensive, co-ordinated approach by management to assessing firm-wide risk exposures proved to be successful†¦ †¢ Firms that avoided such problems demonstrated a comprehensive approach to viewing firm-wide exposures and risk, sharing quantitative and qualitative information more efficiently across the firm and engaging in more effective dialogue across the management team. They had more adaptive (rather than static) risk measurement processes and systems that could rapidly alter underlying ssumptions (such as valuations) to reflect current circumstances. Management also relied on a wide range Box 2. How a â€Å"safe† strategy incurred write downs USD 18. 7bn: the case of UBS By formal standards, the UBS strategy approved by the board appeared prudent, but by the end of 2007, the bank needed to recognise losses of USD 18. 7 bn and to rai se new capital. What went wrong? UBS’s growth strategy was based in large measure on a substantial expansion of the fixed income business (including asset backed securities) and by the establishment of an alternative investment business. The executive board approved the strategy in March 2006 but stressed that â€Å"the increase in highly structured illiquid commitments that could result from this growth plan would need to be carefully analysed and tightly controlled and an appropriate balance between incremental revenue and VAR/Stress Loss increase would need to be achieved to avoid undue dilution of return on risk performance†. The plan was approved by the Group board. The strategic focus for 2006-2010 was for â€Å"significant revenue increases but the Group’s risk profile was not predicted to change substantially with a moderate growth in overall risk weighted assets†. There was no specific decision by the board either to develop business in or to increase exposure to subprime markets. However, as UBS (2008) notes, â€Å"there was amongst other things, a focus on the growth of certain businesses that did, as part of their activities, invest in or increase UBS’s exposure to the US subprime sector by virtue of investments in securities referencing the sector†. Having approved the strategy, the bank did not establish balance sheet size as a limiting metric. Top down setting of hard limits and risk weighted asset targets on each business line did not take place until Q3 and Q4 2007. The strategy of the investment bank was to develop the fixed income business. One strategy was to acquire mortgage based assets (mainly US subprime) and then to package them for resale (holding them in the meantime i. e. warehousing). Each transaction was frequently in excess of USD 1 bn, normally requiring specific approval. In fact approval was only ex post. As much as 60 per cent of the CDO were in fact retained on UBS’s own books. In undertaking the transactions, the traders benefited from the banks’ allocation of funds that did not take risk into account. There was thus an internal carry trade but only involving returns of 20 basis points. In combination with the bonus system, traders were thus encouraged to take large positions. Yet until Q3 2007 there were no aggregate notional limits on the sum of the CDO warehouse pipeline and retained CDO positions, even though warehouse collateral had been identified as a problem in Q4 2005 and again in Q3 2006. The strategy evolved so that the CDOs were structured into tranches with UBS retaining the Senior Super tranches. These were regarded as safe and therefore marked at nominal price. A small default of 4 per cent was assumed and this was hedged, often with monoline insurers. There was neither monitoring of counter party risk nor analysis of risks in the subprime market, the credit rating being accepted at face value. Worse, as the retained tranches were regarded as safe and fully hedged, they were netted to zero in the value at risk (VAR) calculations used by UBS for risk management. Worries about the subprime market did not penetrate higher levels of management. Moreover, with other business lines also involved in exposure to subprime it was important for the senior management and the board to know the total exposure of UBS. This was not done until Q3 2007. Source: Shareholder Report on UBSs Write-Downs, 2008. of risk measures to gather more information and different perspectives on the same risk exposures and employed more effective stress testing with more use of scenario analysis. In other words, they exhibited strong governance systems since the information was also passed upwards to the board. †¦as did more active controls over the onsolidated balance sheet, liquidity, and capital †¢ Management of better performing firms typically enforced more active controls over the consolidated organisation’s balance sheet, liquidity, and capital, often aligning treasury functions more closely with risk management processes, incorporating information from all businesses into global liquidity planning, including actual and contingent liquidity risk. This would have supported implementation of the board’s duties. Warning signs for liquidity risk which were clear during the first quarter of 2007 should have been respected A marked feature of the current turmoil has been played by liquidity risk which led to the collapse of both Bear Stearns and Northern Rock7. Both have argued that the risk of liquidity drying up was not foreseen and moreover that they had adequate capital. However, the warning signs were clear during the first quarter of 2007: the directors of Northern Rock acknowledged that they had read the Bank of England’s Financial Stability Report and a FSA report which both drew explicit attention to liquidity risks yet no adequate emergency lending lines were put in place. Countrywide of the US had a similar business model but had put in place emergency credit lines at some cost to themselves (House of Commons, 2008, Vol 1 and 2). It was not as if managing liquidity risk was a new concept. The Institute of International Finance (2007), representing the world’s major banks, already drew attention to the need to improve liquidity risk management in March 2007, with their group of senior staff from banks already at work since 2005, i. e. well before the turmoil of August 2007. Stress testing and related scenario analysis has shown numerous eficiencies at a number of banks Stress testing and related scenario analysis is an important risk management tool that can be used by boards in their oversight of management and reviewing and guiding strategy, but recent experience has shown numerous deficiencies at a number of banks. The Senior Supervisors Group noted that â€Å"some firms found it challenging before the recent turmoil to persuade senior manag ement and business line management to develop and pay sufficient attention to the results of forward-looking stress scenarios that assumed large price movements† (p. ). This is a clear corporate governance weakness since the board is responsible for reviewing and guiding corporate strategy and risk policy, and for ensuring that appropriate systems for risk management are in place. The IIF report also noted that â€Å"stress testing needs to be part of a dialogue between senior management and the risk function as to the type of stresses, the most relevant scenarios and impact assessment†. Stress testing must form an integral part of the management culture so that results have a meaningful impact on business decisions. Clearly his did not happen at a number of financial institutions some of which might have used externally conceived stress tests that were inappropriate to their business model. Stress testing has been insufficiently consistent or comprehensive in some bank s Stress testing is also believed to have been insufficiently consistent or comprehensive in some banks, which is more an implementation issue of great importance to the board. The IIF concluded that â€Å"firms need to work on improving their diagnostic stress testing to support their own capital assessment processes under Pillar II of the Basel Accord. It is clear that firms need to ensure that stress testing methodologies and policies are consistently applied throughout the firm, evaluating multiple risk factors as well as multiple business units and adequately deal with correlations between different risk factors†. Some have taken on high levels of risk by following the letter rather than the intent of regulations In some cases, banks have taken on high levels of risk by following the letter rather than the intent of regulations indicating a box ticking approach. For example, credit lines extended to conduits needed to be supported by banks’ capital (under Basel I) if it is for a period longer than a year. Banks therefore started writing credit lines for 364 days as opposed to 365 days thereby opening the bank to major potential risks. Whether boards were aware that capital adequacy reports to them reflected such practices is unclear although there is some indication that they did not know in some cases. Transmission of risk information has to be through effective channels, a clear corporate governance issue Even if risk management systems in the technical sense are functioning, it will not impact the company unless the transmission of information is through effective channels, a clear corporate governance issue. In this respect it is interesting to note that â€Å"a recent survey of nearly 150 UK audit committee members and over 1000 globally, only 46 per cent were very satisfied that their company had an effective process to identify the potentially significant business risks facing the company and only 38 per cent were very satisfied with the risk reports they received from management† (KPMG, 2008). In interpreting the survey, KPMG said: â€Å"recession related risks as well as the quality of the company’s risk intelligence are two of the major oversight concerns for audit committee members. But there is also concern about the culture, tone and incentives underlying the company’s risk environment, with many saying that the board and/or audit committee needs to improve their effectiveness in addressing risks that may be driven by the company’s incentive compensation structure†. A failure to transmit information can be due a silo approach to risk management Another example of failure to transmit information concerns UBS. Although the group risk management body was alerted to potential subprime losses in Q1 2007, the investment bank senior management only appreciated the severity of the problem in late July 2007. Consequently, only on 6 August 2007, when the relevant investment bank management made a presentation to the Chairman’s office and the CEO, were both given a comprehensive picture of exposures to CDO Super Senior positions (a supposedly safe strategy) and the size of the disaster became known to the board. The UBS report attributed the failure in part to a silo approach to risk management. Lower prestige and status of risk management staff vis-avis traders also played an important role At a number of banks, the lower prestige and status of risk management staff vis-a-vis traders also played an important role, an aspect covered by principle VI. D. 2 (see above). Societe Generale (2008) noted that there was a â€Å"lack of a systematic procedure for centralising and escalating red flags to the appropriate level in the organisation† (page 6). But soft factors were also at work. â€Å"The general environment did not encourage the development of a strong support function able to assume the full breadth of its responsibilities in terms of transaction security and operational risk management. An imbalance therefore emerged between the front office, focused on expanding its activities, and the control functions which were unable to develop the critical scrutiny necessary for their role† (Page 7). One of the goals of their action programme is to â€Å"move towards a culture of shared esponsibility and mutual respect† (page 34). The inability of risk management staff to impose effective controls was also noted at Credit Suisse (FSA, 2008b). Testimony by the ex-head of risk at the British bank HBOS, that had to be rescued and taken over by Lloyds TSB, gives a picture of a bank management with little regard or care for risk management as it pursued its headlong rush into expanding its mortgage business. 8 An SEC repo rt about Bear Stearns also noted â€Å"a proximity of risk managers to traders suggesting a lack of ndependence† (SEC 2008b). The issue of â€Å"tone at the top† is reflected in principle VI. C and in the Basel Committee’s principle 2 (the board of directors should approve and oversee the bank’s strategic objectives and corporate values that are communicated throughout the banking organisation) as well as principle 3 (the board of directors should set and enforce clear lines of responsibility and accountability throughout the organisation). Remuneration and incentive systems: strong incentives to take risk Remuneration and incentive systems have played a key role in influencing financial institutions sensitivity to shocks and causing the development of unsustainable balance sheet positions It has been often argued that remuneration and incentive systems have played a key role in influencing not only the sensitivity of financial institutions to the macroeconomic shock occasioned by the downturn of the real estate market, but also in causing the development of unsustainable balance sheet positions in the first place. This reflects a more general concern about incentive systems that are in operation in non-financial firms and whether they lead to excessive short term management actions and to â€Å"rewards for failure†. It has been noted, for instance, that CEO remuneration has not closely followed company performance. One study reports that the median CEO pay in S 500 companies was about USD 8. 4 million in 2007 and had not come down at a time the economy was weakening. 9 Board and executive remuneration Remuneration has to be aligned with the longer term interests of the company and its shareholders Principle VI. D. 4 recommends that the board should fulfil certain key functions including â€Å"aligning key executive and board remuneration with the longer term interests of the company and its shareholders†. The annotations note that â€Å"it is regarded as good practice for boards to develop and disclose a remuneration policy statement covering board members and key executives. Such policy statements specify the relationship between remuneration and performance, and include measurable standards that emphasise the long run interests of the company over short term considerations†. Implementation has been patchy. However, remuneration systems lower down the management chain might have been an even more important issue. The Basel Committee guidance is more general extending to senior managers: the board should ensure that compensation policies and practices are consistent with the bank’s corporate culture, long term objectives and strategy, and control environment (principle 6). Executive remuneration has been less analysed and discussed Despite highly publicised parting bonuses for CEOs (Table 1) and some board members, executive remuneration has been much less analysed and discussed even though the academic literature has always drawn attention to the danger of incentive systems that might encourage excessive risk. 10 It is usual in most companies (banks and non-banks) that the equity component in compensation (either in shares or options) increases with seniority. One study for European banks indicated that in 2006, the fixed salary accounted or 24 per cent of CEO remuneration, annual cash bonuses for 36 per cent and long term incentive awards for 40 per cent (Ladipo et al. , 2008). This might still leave significant incentives for short run herding behaviour even if it involved significant risk taking. By contrast, one study of six US financial institutions found that top executive salaries averaged only 4- 6 per cent of total compensation with stock related compensation (and especially stock options in two cases ) hovering at very high levels (Nestor Advisors, 2009). It is interesting to note that at UBS, a company with major losses, long-term incentives accounted for some 70 per cent of CEO compensation and that the CEO is required to accumulate and hold shares worth five times the amount of the last three years’ average cash component of total compensation. Of course, such figures might be misleading since what matters for incentives is the precise structure of the compensation including performance hurdles and the pricing of options. Losses incurred via shareholdings (Table I) might also be partly compensated by parting payments. Ladipo et al. also noted that only a small number of banks disclosed the proportion of annual variable pay subject to a deferral period11. Table 1. Examples of parting payments to CEOs Name and company Estimated payment Losses from options, shares etc Mudd, Fannie Mae USD 9. 3 million (withdrawn) n. a. Syron, Freddie Mac USD 14. 1 million (withdrawn) n. a. Prince, Citibank USD 100 million 50 % drop on share holdings of 31 million shares O’Neal, Merrill Lynch USD 161 million Loss on shares Cayne, Bear Stearns USD 425 million (sales in March 008 at USD 10 per share) Source: OECD. More investigation is required to determine the actual situation and the corporate governance implications of remuneration schemes A number of codes stress that executive directors should have a meaningful shareholding in their companies in order to align incentives with those of the shareholders. Only a few European banks had such formalised policies in 2006. However, the actual amount of stock owned b y the top executive in each the bank was well above 100 per cent of annual fixed salary (Ladipo, p. 55). With respect to non-executive directors, it is often argued that they should acquire a meaningful shareholding but not so large as to compromise the independence of the non-executive directors. Only a few European banks disclosed such policies. UBS actively encourages director share ownership and board fees are paid either 50 per cent in cash and 50 per cent in UBS restricted shares (which cannot be sold for four years from grant) or 100 per cent in restricted shares according to individual preference. Credit Suisse also has a similar plan. However, one study (Nestor Advisors, 2009) reports that financial institutions that collapsed had a CEO with high stock holdings so that they should normally have been risk averse, whereas the ones that survived had strong incentives to take risks. 12 More investigation is required to determine the actual situation with respect to remuneration in the major banks more generally and the corporate governance implications. Incentive systems at lower levels have favoured risk taking and outsized bets Remuneration problems also exist at the sales and trading function level Official as well as private reports have drawn attention also to remuneration problems at the sales and trading function level. 13 One central banker (Heller, 2008) has argued that the system of bonuses in investment banking provides incentives for substantial risk taking while also allowing no flexibility for banks to reduce costs when they have to: at the upper end, the size of the bonus is unlimited while at the lower end it is limited to zero. Losses are borne entirely by the bank and the shareholders and not by the employee. In support, he notes that the alleged fraud at Societe Generale was undertaken by a staff member ho wanted to look like an exceptional trader and achieve a higher bonus. Along the lines of Heller, the International Institute of Finance (2008b) representing major banks has proposed principles to cover compensation policies (Box 3) that illustrate the concerns about many past practices. Box 3. Proposed Principles of Conduct for Compensation Policies I. Compens ation incentives should be based on performance and should be aligned with shareholder interests and long term, firm-wide profitability, taking into account overall risk and the cost of capital. II. Compensation incentives should not induce risk-taking in excess of the firms risk appetite. III. Payout of compensation incentives should be based on risk-adjusted and cost of capitaladjusted profit and phased, where possible, to coincide with the risk time horizon of such profit. IV. Incentive compensation should have a component reflecting the impact of business unit’s returns on the overall value of related business groups and the organisation as a whole. V. Incentive compensation should have a component reflecting the firm’s overall results and achievement of risk management and other goals. VI. Severance pay should take into account realised performance for shareholders over time. VII. The approach, principles and objectives of compensation incentives should be transparent to stakeholders. Source: Institute of International Finance (2008b), Final Report of the IIF Committee on Market Best Practices: Principles of Conduct and Best Practice Recommendations, Washington, D. C. Incentive structures eed to balance various interests The Senior Supervisors Group (2008, p. 7) noted that â€Å"an issue for a number of firms is whether compensation and other incentives have been sufficiently well designed to achieve an appropriate balance between risk appetite and risk controls, between short run and longer run performance, and between individual or local business unit goals and firm-wide objectives†. The concern was also shared by the Financial Stability Forum (2008). Financial targets against which compensation is assessed should be measured on a riskadjusted basis†¦ The private sector report (Institute of International Finance, 2008) also identified compensation as a serious issue: â€Å"there is strong support for the view that the incentive compensation model should be closely related by deferrals or other means to shareholders’ interests and longterm, firm-wide profitability. Focus on the longer term implies that compensation programs ought as a general matter to take better into account cost of capital and not just revenues. Consideration should be given to ways through which the financial targets against which compensation is assessed can be measured on a risk-adjusted basis† (p. 2). Some banks, such as JP Morgan, already build risk weighting into employees’ performance targets to recognise the fact that their activities are putting more capital at risk, but they are the exception rather than the rule. †¦which is more difficult if the internal cost of funds do not take account of risk These issues were picked up in the UBS report, which noted that the compensation and incentive structure did not effectively differentiate between the creation of alpha (i. e. return in excess of defined expectation) versus return from a low cost of funding. In the case of UBS, the internal cost of funds did not take account of risk so that the traders involved in sub-prime could obtain finance at a low cost. This made sub-prime an attractive asset to carry long. Super senior tranches carried low margins so that the incentive was to expand positions to achieve a given level of bonus. The report goes on to note that â€Å"day 1 P treatment of many of the transactions meant that employee remuneration (including bonuses) was not directly impacted by the longer term development of the positions created. The reluctance to allow variations between financial reporting and management accounting made it less likely that options to vary the revenue attributed to traders for compensation purposes would be considered (p. 42). Essentially, bonuses were measured against gross revenue after personal costs, with no formal account taken of the quality or sustainability of those earnings. Senior management, on the other hand, received a greater proportion of deferred equity. Incentive systems at sub-executive level are also a concern for nonfinancial companies Incentive systems at sub-executive level are also a concern for nonfinancial companies. For example, transactions-based compensation and promotion might lead to corrupt practices contrary to company policies and interests. Audit Committees, a key component of the corporate governance structure, appear to becoming aware of the issues. Thus the KPMG survey noted that â€Å"[w]hile oversight of compensation plans may generally fall within the responsibility of the remuneration committee, audit committees are focusing on the risks associated with the company’s incentive compensation structure. In addition to risks associated with an emphasis on short-term earnings, audit committees want to better understand the behaviour and risks that the company’s incentive plans encourage and whether such risks are appropriate. † Basel II enables regulators to impose additional capital charges for incentive structures that encourage risky behaviour The Basel II capital accord contains mechanisms in pillar II enabling regulators to impose additional capital charges for incentive structures that encourage risky behaviour. Indeed, the UK’s FSA has stated that they would consider compensation structures when assessing the overall risk posed by a financial institution but that it would stop short of dictating pay levels14. A leading Swiss banker is also quoted as saying that he expected regulators to use the second pillar of the Basel II accord to oblige banks to hold additional capital to reflect the risk of inappropriate compensation structures (Financial Times, 22 May 2008, p. 17). Risk policy is a clear duty of the board Deficiencies in risk management and distorted incentive ystems point to deficient board oversight Deficiencies in risk management and distorted incentive systems point to deficient board oversight. Principle VI. D. 1 recommends that â€Å"the board should fulfil certain key functions including reviewing and guiding corporate strategy, major plans of action, risk policy†¦ while VI. D. 7 defines a key function to include â€Å"Ensuring the integrity of the corporationâ₠¬â„¢s accounting and reporting systems †¦and that appropriate systems of control are in place, in particular systems of risk management, financial and operational control†. Principle VI. D. 4 identifies the key functions of the board to include â€Å"aligning key executive and board remuneration with the longer term interests of the company and its shareholders†. The Basel Committee Guidance on corporate governance of banks (Basel Committee, 2006) looks more at how responsibilities are implemented: â€Å"the board of directors should set and enforce clear lines of responsibility and accountability throughout the organisation (principle 3)†. A key area concerns internal controls (including in subsidiaries) which requires that â€Å"the material risks that could adversely affect the achievement of the bank’s goals are being recognised and continually assessed. This assessment should cover all risks facing the bank and the consolidated banking organisation (that is credit risk, country and transfer risk, market risk, interest rate risk, liquidity risk, operational risk, legal risk and reputational risk). Internal controls may need to be revised to appropriately address any new or previously uncontrolled risk† (Basel Committee, 1998). The annotations to Principle VI. D. 7 note that â€Å"ensuring the integrity of the essential reporting and monitoring systems will require the board to set and enforce clear lines of responsibility and accountability throughout the organisation. The board will also need to ensure that there is appropriate oversight by senior management†. Financial companies are not unique in this regard even though the macroeconomic impacts of poor risk management are arguably more important Recent experiences in banks as well as in companies as different as Airbus, Boeing, Alsthom, BP and Siemens confirms the Steering Group’s standpoint on the importance of risk management. Earlier cases include Metallgesellschaft and Sumitomo Corporation. Financial companies are not unique in this regard even though the macroeconomic impacts of poor risk management are arguably more important. Non-financial companies also face exchange rate and interest rate risks although operational risks such as outsourcing risks, loss of intellectual property rights, and investment risks in unstable areas might be more important. Box 4. Risk management issues in non-financial companies In recent years there have been numerous examples in major non-financial companies that have highlighted weaknesses and failures in risk management. BP was hit by a refinery explosion in Texas. A commissioned report (the Baker Report) suggests that the risk was well known at lower levels in the company but that it was not adequately communicated to higher levels. This is similar to what happened at Societe Generale and at UBS. The refinery had been acquired as part of a M and it appears that risk management systems and culture had not been fully implemented at the new subsidiary, very similar to HSBC and UBS, the latter also with a new subsidiary. BP also has complex risk models including a model for corrosion used in forecasting expenditures. After major oil spills in Alaska that resulted in suspended output, it was discovered that the model significantly under-estimated corrosion, raising question about testing risk models. Airbus has invested massively in a major investment in developing the large Airbus 380 aircraft. Such projects include substantial exchange rate risk as well as significant payments to customers in the case of late delivery. Despite the substantial risks the company was taking, and which had been approved by the board, information about significant production delays came as a major surprise to the board of both Airbus and its controlling company EADS. Similar surprises were in store for boards at Citibank and UBS. Siemens represents a case of compliance risk with respect to breaking German and other laws covering bribery of foreign officials. The supervisory board of the company appeared not to have clearly specified their expectations and to have overseen their implementation. The fact that the chairman of the board had been the CEO might not have been helpful in getting to grips with practices that had been ongoing for a number of years. Boeing also faced problems in breaching public tender rules, a serious risk for a major defence contractor. A number of banks have faced similar compliance problems in areas such as money laundering and in complying with local regulations (e. g. Citibank private bank in Japan actually lost its license). Source: OECD. But are they up to the task? Does the board obtain relevant information? In the wake of the financial crisis many oards of financial enterprises have been quite active, but why not before? In the wake of the financial crisis many boards of financial enterprises have been quite active with a number of CEO’s at problem banks being replaced. Tellingly, both Citibank and UBS have also announced board room departures to make way for new directors with â€Å"finance and investment expertise†. UBS has gone further and is eliminating the chairman’s office that has been widely criticised in the past by shareholders and Citibank has also restructured the board, eliminating the executive committee. Shareholders have also become more active, especially with respect to voting against audit committee (or equivalent) members who have been held to higher standards of accountability than other board members. The fundamental issue is, Main conclusions The financial crisis can be to an important extent attributed to failures and weaknesses in corporate governance arrangements This article concludes that the financial crisis can be to an important extent attributed to failures and weaknesses in corporate governance arrangements. When they were put to a test, corporate governance routines did not serve their purpose to safeguard against excessive risk taking in a number of financial services companies. A number of weaknesses have been apparent. The risk management systems have failed in many cases due to corporate governance procedures rather than the inadequacy of computer models alone: information about exposures in a number of cases did not reach the board and even senior levels of management, while risk management was often activity rather than enterprise-based. These are board responsibilities. In other cases, boards had approved strategy but then did not establish suitable metrics to monitor its implementation. Company disclosures about foreseeable risk factors and about the systems in place for monitoring and managing risk have also left a lot to be desired even though this is a key element of the Principles. Accounting standards and regulatory requirements have also proved insufficient in some areas leading the relevant standard setters to undertake a review. Last but not least, remuneration systems have in a number of cases not been closely related to he strategy and risk appetite of the company and its longer term interests. Qualified board oversight and robust risk management is important The Article also suggests that the importance of qualified board oversight, and robust risk management including reference to widely accepted standards is not limited to financial institutions. It is also an essential, but often neglected, governance aspect in large, complex nonfinan cial companies. Potential weaknesses in board composition and competence have been apparent for some time and widely debated. The remuneration of boards and senior management also remains a highly controversial issue in many OECD countries. The OECD Corporate Governance Principles in these key areas need to be reviewed The current turmoil suggests a need for the OECD, through the Steering Group on Corporate Governance, to re-examine the adequacy of its corporate governance principles in these key areas in order to judge whether additional guidance and/or clarification is needed. In some cases, implementation might be lacking and documentation about the existing situation and the likely causes would be important. There might also be a need to revise some advice and examples contained in the OECD Methodology for Assessing the Implementation of the OECD Principles of Corporate Governance. however, why boards were not effective in the years preceding the turmoil especially in view of the emphasis given in many countries in recent years to internal control even though it was restricted to financial accounts (e. g. SOX 404 certifications). Reports have not so far dealt in much depth with the role and performance of the boards The available reports have not so far dealt in much depth with the role and performance of the boards, the focus being on documenting risk management failures. This is an unfortunate omission since it is a prime responsibility of boards to ensure the integrity of the corporation’s systems for risk management. A private sector report (Institute of International Finance, 2008a) has examined board performance concluding that â€Å"events have raised questions about the ability of certain boards properly to oversee senior managements and to understand and monitor the business itself†. This is a potentially very worrying conclusion. There appears to be a need to re-emphasise the respective roles of the CEO and the board in the risk management process The IIF report stressed that a solid risk culture throughout the firm is essential but that there appears to be a need to re-emphasise the respective roles of the CEO and the board in the risk management process in many firms. The report goes on to make suggestions for strengthening Board oversight of risk issues; the boards need to be educated on risk issues and to be given the means to understand risk appetite and the firm’s performance against it. A number of members of the risk committee (or equivalent) should be individuals with technical financial sophistication in risk disciplines, or with solid business experience giving clear perspectives on risk issues. A separation between risk and audit committees should be considered. However, form should not be confused with actual operation. At Lehman Brothers, there was a risk committee but it only met twice in both 2006 and 2007. Bear Stearns’ only established a full risk committee shortly before it failed. Above all, boards need to understand the firm’s business strategy from a forward looking perspective, not just review current risk issues and audit reports. A survey of European banks indicate that risk management is not deeply embedded in the organisation, a clear corporate governance weakness Supporting information has been presented in a survey based on interviews with European banks (Ladipo et al. , 2008). All interviewed banks accepted that risk governance was a key responsibility of bank boards. All the banks interviewed stressed that board priorities included defining the company’s risk appetite and indentifying emerging areas of risk. A number also noted that the board must ensure that risk appetite is a coherent reflection of the company’s strategic targets. With these expectations, it is important to note that a majority of the banks indicated that their boards were broadly knowledgeable rather than extremely knowledgeable of their company’s risk measurement methodology. More importantly, only one third of the banks were confident that their strategy and planning functions had a detailed understanding of their companies’ risk measurement methodology (Ladipo, 2008, p. 45). This would indicate that risk management is not deeply embedded in the organisation, a clear corporate governance weakness. A good example is provided in the UBS report which noted that the strategic decision to build rapidly a fixed income business (i. e. achieve significant market share) was not associated with a orresponding change to risk policy and risk appetite and a requirement for appropriate indicators. On the other hand, there are worries about the board oversight model of corporate governance: one bank noted that â€Å"risk issues are increasingly becoming too specialist for meaningful oversight by the whole board† (op. cit. , p. 47). Risk management information was not always appropriate or available to the board Reports have documented that risk management information was not always available to the board or in a form corresponding to their monitoring of risk. 15 An important Principle in this respect is VI. F, which states that: â€Å"In order to fulfil their responsibilities, board members should have access to accurate, relevant and timely information†. 16 The efficiency of the risk management process and its connection to board oversight has led a number of companies to establish a Chief Risk Officer (CRO) with board membership in unitary board systems. With an appropriate mandate, CROs can potentially provide a strong internal voice for risk management Achieving a strong internal voice for risk management will depend on firm specifics such as size and complexity. It has been done successfully where the CRO reports directly to the CEO or where the CRO has a seat on the board or management committee. In many cases, the CRO will be engaged directly on a regular basis with a risk committee of the board, or when there is not one, with the audit committee. This area might need more attention in the Principles that are still focused on internal controls for financial reporting. Some banks make it a practice for the CRO to report regularly to the full board to review risk issues and exposures, as well as more frequently to the risk committee. The IIF study concluded that to have a strong, independent voice, the CRO should have a mandate to bring to the attention of both line and senior management or the board any situation that could materially violate risk-appetite guidelines. Similar arrangements have often been introduced to support the work of internal auditors. Board composition The composition of risk committees is also an important issue As with an audit committee, the composition of any risk committee is also an important issue17. Ladipo reports that in their sample of 11 European banks with risk committees (Figure I), a half staffed their committees with non-executive directors. However, they also reported that in such cases the CEO, the CFO and the CRO were always in attendance at the committee meetings and are reported to have played a major role in the committee’s deliberations. In two cases, including UBS, non-executive directors comprised only a third of the risk committee. Whether committees staffed by non-executive directors but where officers of the company play a key role differ from those where executives are actual members is a key policy concern. Presumably, the Senior Supervisors Group has sufficient experience to make such a judgement: in at least one case they formed the judgement that there is indeed a difference. In the US, a number of financial institutions do not have a separate risk committee but rather have made it a matter for the audit committee. One Survey reports that audit committees feel that their effectiveness may be hampered or negatively impacted by overloaded agendas and compliance activities (KPMG, 2008). The legal requirement in the US for audit committees to have only independent directors distorts the information content of Figure I for the US. Figure 1. Non-executive directors as a percentage of the Risk Committee Source: Ladipo, D. et al. (2008), Board profile, structure and practice in large European banks, Nestor Advisors, London. The quality of board members is a particular concern, but fit and proper person tests often do not fully address the issue of competence The quality of board members is a particular concern of bank supervisors who often set fit and proper person tests. However, such tests do not fully address the issue of competence in overseeing a significant business that is an issue for shareholders and other stakeholders. The issue of board competence is addressed by Principle VI. E that states that â€Å"the board should be able to exercise objective independent judgement on corporate affairs†. The annotations note that a negative list for defining when an individual should not be regarded as independent can usef