A recent Deloitte survey shows 57% of APAC respondents perceive some or a substantial increase in inherent risks related to third-parties.
Businesses in Asia Pacific are being exposed to higher risk as their interdependence on third-parties rises.
According to a recent Deloitte survey, 44% of respondents in APAC report some or substantial increase in dependence on third parties while 57% perceive some or a substantial increase in inherent risks related to third-parties.
However, only 15% of them report they have already had integrated and optimised EERM mechanisms to help them manage this risk.
The firm recently released the results of its third annual EERM (extended enterprise risk management) survey, based on 975 responses from a variety of organisations across major industry segments and from 15 countries across the Americas, Europe Middle East and Africa and Asia Pacific.
Only 20% of organisations have streamlined their EERM systems and processes, though a huge 70% believe that business and macro-economic uncertainties have increased the risks inherent in managing the extended enterprise and 53% of them report ‘some’ or ‘significant’ increase in their level of dependence on third-parties results indicate.
The most common business case driver for business case for EERM investment in the region is the need to achieve reduced organisational spend on third-parties in the extended enterprise (42%), while 20% are more driven by the opportunity to increase revenue, for instance by the identification of unreported or under-reported revenue streams, the report indicates.
Other major findings related to the region:
- 75% of respondents from Asia Pacific have implemented centers of excellence or shared services centers for EERM
- No respondents have outsourced EERM substantially to a managed services provider
- 56% of respondents evaluate their organizations’ overall control structures to be equally or more decentralized
- 54% of respondents believe their organizational structures for EERM are decentralized
- Three out of four respondents lack the knowledge and visibility of sub-contractors
- 34% of respondents acknowledge they either do not monitor sub-contractor risks at all or do not know if anyone in their organization does so.
- 19% of respondents state that they monitor sub-contractors on a half-yearly or quarterly basis
- 9% of respondents have high engagement from their boards
- Only 15% of respondents have a high level of engagement from risk owners