Boards of directors have become increasingly aware of their responsibilities related to effective oversight of managements execution of enterprise-wide risk management processes. This is due, in part, to significant external pressures that have developed recently that are thrusting risk management and its oversight to the
forefront of many board agendas and management action plans. For example, the New York Stock Exchange in 2004 adopted governance rules that require audit committees of NYSE-listed firms to oversee managements risk oversight processes. In 2008, Standard & Poors began explicitly evaluating an issuers enterprise risk management (ERM) processes in seventeen new industries, as an additional component of their credit ratings analysis. In 2009, the Securities and Exchange Commission (SEC) expanded proxy disclosure requirements to increase information for investors about the boards role in risk oversight. The 2010 Federal Financial Reform legislation now mandates risk committees for boards of financial institutions and other entities overseen by the Federal Reserve.