Professional risk managers disagree about governance. (Business Briefs).

Despite exhaustive analysis and debate about corporate governance practices, as well as a dose of federal legislation aimed at improving them, professional risk managers strongly disagree about what constitutes effective corporate governance, according to a survey by Allianz Global Risks.

Thirty-nine percent of 115 respondents who attended the annual Risk and Insurance Management Society Inc. conference in Chicago recently believe that the Sarbanes-Oxley Act will significantly reduce corporate malfeasance. But another 33 percent don't think it will, and 28 percent don't know if the legislation will be effective. (The respondents represented a broad range of industries; 87 percent are from North America, and 65 percent work at companies with more than $500 million in annual revenues.)

"We don't think legislation is a substitute for good risk management programs. We are looking at a company's overall corporate governance program, and more importantly, if it is ingrained in daily corporate behavior," says Brian Gauen, vice president of underwriting for directors and officers (D&O) liability insurance for Allianz Insurance Co., the U.S. unit of Allianz Global Risks. "Corporate governance practices have a direct impact on the availability and pricing of D&O insurance."

Significant divergence in corporate governance programs exists beyond Sarbanes-Oxley. For example, 27 percent of respondents said their companies don't have a formal "whistleblower" process.

"Given that whistleblowers proved instrumental in uncovering fraud in recent high-profile cases and that such a policy is one of the easiest elements of a corporate governance program to put in place, it's surprising more companies haven't done so," says Gauen. "It raises questions about whether companies have tackled tougher challenges that would focus on prevention rather than uncovering wrongdoing after the fact."