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He has also appointed a senior executive, Kenneth M. deRegt, to oversee risk and report to him.
Given the wide spectrum of risks that most companies face, it is critical that boards evaluate the manner in which they oversee risk management.
In deciding how to organize itself to oversee risk and risk management, the question arises as to whether the board should establish a separate risk committee.
Glass, Lewis & Company, a proxy advisory firm in the United States, is recommending that shareholders vote against all nominees, citing a lack of independent members to oversee risk.
She also said it would be better to give a council of regulators, which would include her agency, the authority to oversee risk across the industry, rather than vest broad new authority in the Federal Reserve.
Another point that needs to be raised and was part of the reason Lehman fell was the lack of information getting to the persons who oversee risk in most companies sighted – the Board of Directors.
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Compensation committees oversee risks related to how the compensation structure drives behavior within the organization.
The bill that emerged calls for a council to oversee risks to the entire financial system, which includes firms and activities that pose such a risk.
Mr. Buffett answers that overseeing risk is a real job, one that's not to be delegated.
"The banks do diversify their positions," said Robert H. Litzenberger, an advisory director at Goldman , Sachswho recently retired from overseeing risk policy at the firm.
Part of that change began Friday, when the bank announced that Irvin Goldman, who had overseen risk for the chief investment office, was resigning.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com