    
It is not always easy to detect hidden risks. Enron, WorldCom and Marconi passed the ‘corporate governance tick list’, but for certain, the art of governance means more than just checking boxes. It depends on the balance, composition, alertness, intelligence, creativity and quality of communication of its corporate management. Good housekeeping and monitoring are essential. But what really produces prosperity is people, teamwork, leadership, enterprise, experience and skills. There is no single formula to weld these together, and it is dangerous to encourage the belief that rules and regulations about structure will deliver success. However, a balance between taking entrepreneurial risks and risk avoidance is needed. The best is to ensure that danger is averted ahead of time, but management must also be able to react promptly to unexpected events such as global, political and social crises or pre-emptive strikes by competitors. Every company has its particular risks, both financial and non-financial. The personalities and styles of the individuals in charge will determine the company’s approach to risk – as to opportunities. They will each have their strengths and blind spots. Recognising that makes it easier to know what questions to ask and how to provide checks and balances. The key to good risk management is the knowledge, experience and wisdom to ask the right questions at the right time. The greater the trust among decision-makers, the more effective they work. Particularly with unexpected risk, management has to operate creatively, effectively and at speed. This may mean having to tackle problems in a variety of ways and at minimum notice. Lynn McGregor is a recognised leader in the field of corporate governance and executive leadership. She is the founder of the UK-based consulting firm Convivium and serves on the editorial advisory board of the international journal, Corporate Governance. She was one of the speakers at the Novo Group Academy in December 2002. | 
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