Over on RealTransparentDisclosure.com, Broc Romanek blogged about a recent Labrador Transparency Report reviewing 2025 proxy statement risk oversight disclosures and recommending potential enhancements for companies to consider as they prepare their 2026 proxies.

The report says that risk oversight disclosures have fallen into a bit of a rut, with companies generally following the same standardized format. These disclosures typically start with a matrix showing board and committee oversight of key risks and management’s role. That’s followed by description of the company’s ERM program and more detailed discussion on the board’s oversight of more significant risks.

Does that sound familiar? Yeah, I thought so. Anyway, Broc excerpts some suggestions from the report on how companies might do a better job on these disclosures:

1. Rethink the Traditional Committee Oversight Matrix: Many companies cite the desire to streamline text and remove duplication in their proxy statements. We recommend taking a look at your Committee descriptions and Risk Oversight disclosures to see how they overlap. Similarly, think about whether key risks are overseen by the Board or a singular committee, or whether there is a more cross-functional approach.

2. Show an Integrated Approach to Risk Throughout the Company: The traditional Board/Committee/management oversight graphic often includes only a high-level overview of the role of management in managing risks, with a separate discussion on the ERM process. Two Dow 30 companies take a different approach, incorporating a crisp, easy-to-digest graphic that shows their top-down/bottom-up risk management governance structure.

3. Reflect Better Alignment Between Risk, Strategy and Sustainability: Growing anti-ESG backlash and the current political and legal environment have caused companies to rethink whether and how they report on sustainability-related topics in their proxy statements and annual reports on Form 10-K. We recommend, however, taking a step back from the rhetoric and examining the interrelated nature of sustainability, risk management, strategy and competition, and long-term value creation.

With respect to this final point, the report cites a 2024 Harvard Business Review article arguing that corporate leaders should address sustainability issues that “have the most impact on the bottom line” and identify the most material negative impact their company is having on society, and then make significant investments to develop practical solutions. It also notes a PwC report recommending that companies integrate sustainability into their ERM process.

– John Jenkins