While the boards of directors of mutual funds are not responsible for managing risk, they still have a key role to play in overseeing investment and operational risks, according to a white paper just released by the Investment Company Institute and Independent Board of Directors.

The ICI, the Washington, D.C. trade group representing U.S. mutual funds, and IBD said that the board's role in risk oversight must be disclosed in a mutual fund's registration statement and they outlined five best practices for fund boards in addressing risk management. They are as follows:

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