Do Indian companies understand financial risk?
D Murali and Kumar Shankar Roy Chennai: Indian Inc. is going global. They are acquiring much larger competitors, aggressively entering new markets and exploring various financial tools. But the moot question is whether they can manage the risks that emanate from such moves. Intense global competition and rapid growth are forcing Indian firms to examine corporate enterprise risk management (ERM) elsewhere, especially in Europe, Australia and North America, where the process is more mature, concludes a report by The Conference Board (www.conference-board.org), a non-partisan and not-for-profit business membership and research organisation. While Tata Motors, ICICI Bank, Tata Chemicals and Dr Reddys, represent case studies for The Conference Board by virtue of their use of ERM as a management tool, most of the Indian firms generally do not take such a comprehensive approach. Agrees Mr Richard Rekhy, Chief Operating Officer of consultancy firm KPMG (one of the sponsors of the report titled
