Australian companies risk falling further behind counterparts in other industrialised economies if they continue to lag in risk management, according to an Ernst & Young global survey.

The results, drawn from the responses of 1196 companies including 82 from Australia, paint a mixed picture for local businesses.

About 75% of Australian companies prepare management dashboards annually or quarterly, which is slightly below the global figure of 78%.

Just 59% have defined key performance indicators or key risk indicators (compared with 63% globally) and of businesses that follow such indicators, only 45% use technology to do so (compared with 61%).

Australian companies perform slightly better in other areas.

About 84% evaluate their risk profile annually, against 77% globally, and 94% say their risk profiles influence capital allocations decisions (compared with 90%).

“The overall trend is that Australia is on par with counterparts in Europe and the US,” Ernst & Young Oceania Risk Transformation Leader Catherine Friday told insuranceNEWS.com.au. “Historically, Australia has always been at the forefront of risk management… the fact we no longer have that position is a bit of a concern.”

Only 7% of company boards in Australia identify and evaluate risk management and business objectives in “real time”, which severely restricts the process’ chance to make a meaningful contribution.

Ms Friday says European and US companies are making better use of real-time data to make risk-based decisions.

“Without the right information, you can’t make right decisions and most organisations are sitting on a rich vein of management data they are not exploiting to its full potential.

“It’s a wasted business resource that they should be using and savvy companies are starting to use that.”

She sees a gradual change in thinking, with more local companies starting to realise the value of real-time data.

The survey was carried out between February and March across 63 countries, and covers 25 industries including banks, the public sector, mining and metals, real estate, utilities and insurance. Of the 82 Australian respondents, eight are insurers, Ms Friday says.