Risk management as increased corporate governance requirement in Italian banks and insurance companies
As financial institutions whose business is the acceptance and management of risk, banks and insurance companies are expected to have sound governance practices and effective risk management systems. The nature of their business activities requires banks and insurers to be subject to tailored guidance on their risks and responsibilities. The governance structure should have an appropriate allocation of oversight and administrative responsibilities, stipulate and delineate clearly the duties, responsibilities and qualifications of persons having responsibilities, and protect the rights of shareholders (or memberpolicyholders) and the interests of policyholders. Corporate governance can be generally defined as the system by which companies are directed and controlled (Cadbury, 1992) Most of the existing issues apply to all financial institutions also because the OECD guidelines are the basic standard for good practices in corporate governance and focus on "publicly traded companies, both financial and nonfinancial" (OECD, 2004; OECD, 2010) Corporate governance of banks and insurance companies differs from the corporate governance of other private companies. Banks' stakeholders vary more widely than those of other private companies, including not only pure shareholders, or investors but above all depositors. Banks have some specific Abstract