Conduct Risk - Revision history

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 [[Category:Trust]]
 [[Category:Assurance]]
-[[Category:Vulnerability]]
+[[Category: Vulnerability]]
-[[Category:Risk]]
+[[Category: Risk]]

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 *Since executive compensation is often predicated on shareholder value, any risk must be measured strictly in that metric to become an important consideration for executive action by the bulk of public companies. A similar calculus will apply to public enterprises because of pressures from the population at large and thanks to the investigations of a free press where it still exists. In both cases [[Conduct Risk]] is a growing discipline that [[Enterprise]]s have learned to fear through the experiences with general business cases describe on the page [[Conduct Risk]] as well as those cases that are specific to service providers.
 *The executive are not held accountable by any force but the risk that their bonuses will be cut. In a few cases, the company was put at existential risk of failure, but the executives generally do not suffer. Until the boards hold the executive accountable for this sort of action, there will be no change. Today the boards seem to be more worried about take-over attempts by dissident shareholders who are more concerned with next quarter's earnings than they are with the continued existence of the company.
-*Consumers are starting to take action based on data breaches. In a Ping Identity study<ref>Ping Identity ''2019 CONSUMER SURVEY:
+*Consumers are starting to take action based on data breaches. In a Ping Identity study<ref>Ping Identity ''2019 CONSUMER SURVEY: TRUST AND ACCOUNTABILITY IN THE ERA OF DATA MISUSE,'' https://www.pingidentity.com/content/dam/ping-6-2-assets/Assets/Misc/en/3464-consumersurvey-execsummary.pdf#study</ref> it was found that "81% would stop engaging with a brand online following a breach (up 3% from 2018), and 25% would stop all interaction whatsoever." In spite of this trend, breaches continue to occur on a daily basis. At a 2019-10-28 identity meeting-up there was consensus that the challenge in getting companies to spend money on security was showing a decrease in costs rather than a decrease in risk. CEO's, like Boeing's<ref>Michael A. Cusumano, ''Boeing's 737 MAX: A Failure of Management, Not just Technology'' '''CACM 64''' (2021-01)</ref> or GE's, have focused on short term financials rather than the overall health of the company. Both of those have fallen from highly successful to badly damaged based on misunderstanding the real objectives of the CEO's office.
 ===Technology===
 Many of the risk factors arise because management is not equipped to deal with the rapid changes in technology and the impact that can have on business operations and customer expectations. For example both Google and Microsoft issued warnings in their recent filings on the risk that bad outcomes are highly likely as [[Artificial Intelligence]] becomes an increasingly large component of their operations.<ref>Tom Simonite, ''Google and Microsoft Warn That AI May Do Dumb Things.'' (2019-02-19) Wired Magazine https://www.wired.com/story/google-microsoft-warn-ai-may-do-dumb-things</ref>

← Older revision		Revision as of 15:09, 9 August 2021
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← Older revision		Revision as of 16:18, 30 October 2019
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	===Other Material===		===Other Material===
−	The wiki page on [[Privacy Risk]] ~~share much conduct~~ with this page as privacy risk is becoming a significant factor in [[Conduct Risk]].	+	The wiki page on [[Privacy Risk]] shares some content with this page as privacy risk is becoming a significant factor in [[Conduct Risk]].

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 *Changing corporate habits can be difficult unless the CEO of the [[Enterprise]] makes and enforces a commitment to treating the employee and the customer with respect. <ref>Time magazine special report on Habits</ref>
 * Large accounting firms have all started “Conduct Risk” practices due to the growing demand, but also to the expectation of continued pressure from regulatory bodies to assure that Enterprises are positioned to absorb the costs of unsafe behavior.
-* The best solution would be for financial disclosure documentation to require the inclusion of a conduct risk assessment in every mandated disclosure, with privacy risk as a component of that section. This procedure will never anticipate changes brought about by radically new technologies, but it will require inclusion of risks as they are recognized. Large numbers of shareholder suits are based on misleading the investors on the risk of behavior.<ref>Brendan Pierson, ''Former Exxon CEO Rex Tillerson testifies in climate change fraud trial''Reuters (2019-10-30) https://www.reuters.com/article/us-exxon-mobil-lawsuit/former-exxon-chief-rex-tillerson-to-testify-in-climate-change-fraud-trial-idUSKBN1X912M</ref>
+* The best solution would be for financial disclosure documentation to require the inclusion of a conduct risk assessment in every mandated disclosure, with privacy risk as a component of that section. This procedure will never anticipate changes brought about by radically new technologies, but it will require inclusion of risks as they are recognized. Large numbers of shareholder suits are based on misleading the investors on the risk of behavior.<ref>Brendan Pierson, ''Former Exxon CEO Rex Tillerson testifies in climate change fraud trial'' Reuters (2019-10-30) https://www.reuters.com/article/us-exxon-mobil-lawsuit/former-exxon-chief-rex-tillerson-to-testify-in-climate-change-fraud-trial-idUSKBN1X912M</ref>
 * In Germany the boards are required to have representatives of the community and labor unions. This assures that there is some input as to the [[Common Good]] of the community and the workers at the company.

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 ==Solutions==
-*Changing corporate habits can be difficult unless the CEO of the [[Enterprise]] makes and enforces a commitment to treating customer with respect. <ref>Time magazine special report on Habits</ref>
+*Changing corporate habits can be difficult unless the CEO of the [[Enterprise]] makes and enforces a commitment to treating the employee and the customer with respect. <ref>Time magazine special report on Habits</ref>
 * Large accounting firms have all started “Conduct Risk” practices due to the growing demand, but also to the expectation of continued pressure from regulatory bodies to assure that Enterprises are positioned to absorb the costs of unsafe behavior.
 * The best solution would be for financial disclosure documentation to require the inclusion of a conduct risk assessment in every mandated disclosure, with privacy risk as a component of that section. This procedure will never anticipate changes brought about by radically new technologies, but it will require inclusion of risks as them are recognized.