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Enterprise Risk Management Should Include Human Capital Risks

HCR accounts for half of operating costs, but 60% of companies ignore it

The Conference Board
Wed, 07/13/2011 - 11:35
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According to a new report released by The Conference Board, companies need to incorporate risks from workforce and people-management issues more fully into their overall risk-management structures. Based on a global survey of executives at 161 leading companies, “Managing Human Capital Risk: A Call for a Partnership Between Enterprise Risk Management and Human Resources” is the most extensive study to date on the role of human resources in the calculus and containment of enterprise risk.

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The report was co-authored by Mary B. Young, principal researcher in human capital at The Conference Board; Ellen S. Hexter, principal of Hexter and Co., a risk consulting firm; and the senior advisor for enterprise risk management at The Conference Board. The report examines the current state of human capital risk management in companies in the United States, Europe, and Asia.

At most companies, human capital accounts for at least half of operating costs and can have a significant impact on business results.

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