Although a number of Indian companies have increased their focus on forex risk management, many of them have not yet been able to translate it into more efficient operations, showed a survey by leading forex consultancy firm Mecklai Consultants.

However, companies in the commodities business have shown a much stronger focus on risk management, the surveys author Jamal Mecklai said.

The survey comes almost a year after a host of Indian companies were caught at the wrong end of unprecedented volatility in the currency markets. Companies hedge their foreign currency needs by taking positions in the global currency markets. But many had to book large losses as the credit crunch deepened and capital outflows sent many currencies haywire .

Most companies are still struggling to put in place processes, given that they are constantly worried about movements in the currency , said Mr Mecklai. Perhaps, in light of the significant forex losses suffered by many companies, they are not yet comfortable with devolving adequate authority to their treasuries, he told ET. Mr Mecklai points this out as a necessary condition for effective risk management operations.

This was the second such annual survey and involved 55 respondents against 45 last year.

However, the survey conceded that linkage between management focus and both design of risk management processes and sophistication of treasury operations was much higher this year than the last. Clearly, the unprecedented volatility in financial markets has made treasuries more proactive in risk management, Mr Mecklai said.

Companies involved in the commodities business laid greater emphasis on risk management, the survey found. He reasoned that for a commodities company, monitoring the price of a commodity is a full-time concern.