Companies today face unparalleled upside opportunities and downside risks. According to the 2017-2018 NACD Public Company Governance Survey, the most important area (with a 71% response rate) where directors want to see improvement in the next 12 months is:
“The board’s understanding of risks and opportunities affecting company performance.”
The same NACD survey cites the top five trends that directors foresee as having the greatest effect on their companies: (1) significant industry change, (2) business model disruption, (3) changing global economic conditions, (4) cybersecurity threats, and (5) competition for talent.
In this interactive chat, James Lam provided an overview of best practices in board risk oversight, using the turnaround story and ERM journey of E*TRADE Financial as a practical and compelling case study. Michelle Lee and James Lam then discussed with the audience the key opportunities and major risks that companies face.
The program included:
Best practices in board risk oversight based on the E*TRADE case study
President, James Lam & Associates, Director and Chair, Risk Oversight Committee E*TRADE
James Lam is a member of the Board of Directors of E*TRADE Financial where he chairs the risk oversight committee and is a member of the audit committee. His previous board experience includes ERisk, Inc. and Covarity, Inc.—both start-up software companies. Mr. Lam is President of James Lam & Associates, a risk management consulting firm he founded in 2002. He works with corporate directors and executives across all industry sectors, including global banks, technology companies, energy firms, multinational corporations, regulatory agencies, and nonprofits. In a Euromoney survey, Mr. Lam was nominated by clients and peers as one of the world’s leading risk consultants. He previously served as founder and president of ERisk, partner of Oliver Wyman, chief risk officer of Fidelity Investments, and chief risk officer of GE Capital Markets Services.
In 2017, Mr. Lam was named to the NACD Directorship 100 in recognition of his leadership in the boardroom community. In 2005, 2006, and 2008, Treasury & Risk Management magazine named him one of the 100 Most Influential People in Finance. In 1997, he received the inaugural Risk Manager of the Year Award from the Global Association of Risk Professionals.
Mr. Lam is the author of Enterprise Risk Management (Wiley, 2003; second edition, 2014), which has ranked #1 as a best-selling title among 25,000 risk management titles on Amazon. The book has been translated into Chinese, Indonesian, Japanese, and Korean. His latest book, Implementing Enterprise Risk Management, was published by Wiley in 2017.
Mr. Lam is an NACD Board Leadership Fellow and a faculty member of NACD board training programs, and he is certified by the Software Engineering Institute of Carnegie Mellon in Cybersecurity Oversight. He graduated with a Bachelor of Business Administration from Baruch College and a Master of Business Administration from the University of California, Los Angeles.
Herman Phleger Visiting Professor of Law, Stanford Law School, Director, Alarm.com
The Honorable Michelle K. Lee is a public company board member, former chief executive, a digital transformation strategist, an MIT-trained engineer, a Silicon Valley veteran experienced in scaling fast-growing companies, and one of the top intellectual property experts in the world. Ms. Lee served as the Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office, where she was chief executive of one of the largest intellectual property offices in the world with annual revenues of over $3 billion and 13,000 employees. Prior to that, Ms. Lee was an executive at Google, serving as Deputy General Counsel; a partner at the law firm of Fenwick & West; and a computer programmer at Hewlett-Packard Research Laboratories and the MIT Artificial Intelligence Lab. She holds a Bachelor of Science and a Master of Science in electrical engineering and computer science from MIT and a JD from Stanford Law School. She is the Herman Phleger Visiting Professor in Law at Stanford and serves as a public company board of director for Alarm.com (NASDAQ: ALRM).