Aon Study Reveals CFOs Seeking to Reduce Financial Uncertainty and Gain Competitive Advantage; Strategic Risk Management Supplying the Answers.

Business Editors

CHICAGO--(BUSINESS WIRE)--March 26, 2002

CFOs are looking for ways to maintain earnings stability and secure a competitive advantage in the uncertain economic market and are finding it in an unlikely place - risk management - according to final results of a survey released today by Aon.

Companies are discovering that a more strategic approach to risk management can help identify promising new opportunities, limit potential surprises and create efficiencies. Strategic risk management provides executives with a tool for anticipating unexpected events and planning for their potential impact, a critical need underscored by recent events.

"Strategic risk management should focus on the critical risks that could impact the company's business strategy," said Aon's risk strategies spokesperson - managing director, Randy Nornes. "With the skittish state of financial markets today, companies can ill afford to simply respond to surprises. Leading companies are using risk assessment, risk modeling and planning to anticipate and exploit risk."

According to the survey, CFOs believe that strategic risk management can create other significant benefits, including better capital allocation, lowered cost of risk transfer, and an improved response to a wider range of risks. Nearly half of CFOs surveyed believe that risk management creates a competitive advantage for their company.

Conducted by CFO Research Services last fall, the survey shows that a significant number - more than half - of senior financial executives at multinational companies have or expect to fully integrate their risk management functions across the company in three years. Only 12 percent expect to continue managing risk on an individual risk-by-risk basis.

However, the study also shows that CFOs face significant challenges in implementing a more strategic approach to risk. Common obstacles include a lack of uniform metrics, time constraints, limited human and financial resources, and inadequate data and technology support. Nearly three out of four surveyed hope that greater involvement from Board-level audit committees will lead to greater senior management support, ultimately helping to overcome some of these obstacles.

"Audit committees are continuing to take a more active role in risk management. As a result, leading companies will continue to accelerate efforts to integrate risk management across business units and promote a closer linkage between risk management and business strategy," Nornes advised. He concluded that, "In a world of uncertainty, good risk management can be a powerful competitive weapon."

The complete results of the survey, "Strategic Risk Management: New Disciplines, New Opportunities," are available online at www.aon.com and www.cfo-research.com.

Aon Corporation (www.aon.com) is a holding company that is comprised of a family of insurance brokerage, consulting and insurance underwriting subsidiaries.

This press release may contain certain statements relating to future results, which are forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated, depending on a variety of factors such as general economic conditions in different countries around the world, fluctuations in global equity and fixed income markets, changes in commercial property and casualty premium rates, the competitive environment, the actual cost of resolution of contingent liabilities, the final form of the business transformation plan, the ultimate cost and timing of the implementation thereof, the actual cost savings and other benefits resulting therefrom, whether the Company ultimately implements the proposed spin-off of its underwriting operations, and the timing and terms associated therewith, and events surrounding terrorists attacks of September 11, 2001, including the timing and resolution of related insurance and reinsurance issues. Further information concerning the Company and its business, including factors that potentially could materially affect the Company's financial results, are contained in the Company's filings with the Securities and Exchange Commission.