Board risk oversight continues to be a concern

From today’s WSJ:

“In discussing an emergency safety bulletin the FAA issued after the Lion Air crash, the suit said that Mr. Muilenburg was more concerned with potential cash-flow disruptions than safety matters. “We need to be careful” that the FAA’s interest in the contents of flight manuals, he wrote to Greg Smith, the company’s chief financial officer, “doesn’t turn into a compliance item that restricts near-term deliveries.”

The risk-management update to the board after the first crash didn’t include oversight of airplane safety, according to the suit, nor did safety issues surface as part of a December 2018 meeting of the board’s audit committee.”

The headline of the WSJ story was “Boeing Board Failed to Challenge CEO, Lawsuit Says.”

Organizations may need to not only assess their ERM process but also revisit how they setup and practice board risk oversight.