Board duties : monitoring, risk management and compliance

This chapter looks at the role of corporate boards in risk oversight, risk management, and compliance through a comparative lens, drawing on examples from international guidance and diverse legal systems, primarily, the United States, the United Kingdom, leading European jurisdictions, and China. It argues that given the complexity of modern corporations and of the risk environments in which they are situated, fiduciary duties and corporate boards themselves must be understood in relation to the transnational networks of inter-related actors, regulatory regimes, and other institutions that impact how boards carry out their monitoring role. This chapter outlines the basic mechanisms of risk oversight, risk management, and compliance in various jurisdictions; discusses diverse conceptions of fiduciary duty and their limits; and considers the challenges and complexity of risk oversight and risk management, particularly with respect to emerging risks. It concludes by identifying key sources of corporate risk oversight that inform and complement corporate boards' role.