A Brief Note On Erm Leadership And Culture

Enterprise Risk Management (ERM) is a series of processes used to identify risk, implement strategies to address risk, and monitor impact on the organization. Indeed, an effective ERM will consist of a corporate profile, which is a record of key risks that would hinder the organization in achieving their key objectives (Fraser & Simkins, 2010). Ideally, the risk profile is created as a tool to communicate with the Board of Directors, but may be used as a means of communication with all levels of management (Bethel, 2016). Typically, there are variations of the risk profile based upon the level of management, such as duration, types of risk, and purpose (Fraser & Simkins, 2010).

Risk management can be defined as the process of discovering, identifying, and assessing the risks facing an organization’s operations, as well as determining how said risks can be either controlled or mitigated (Whitman & Mattord, 2013).  Moreover, a significant component of risk management is risk analysis, which is the identification and assessment of the various levels of risk in the organization.  Due to this fact, risk management must remain an ongoing process, and the safeguards and controls that are devised and implemented cannot be viewed as “install and forget” devices.  Additionally, this comprehensive process requires an organization to frame risk, assess risk, respond to risk once determined, and most importantly, monitor risk on an ongoing basis through the use of active organizational communications and continuous improvement feedback loops. Furthermore, the fact that most businesses identify and implement new information technology systems in response to changes in the market on a regular basis justifies the need for an ongoing risk management process.

A holistic view of risks is crucial for business profitability and this can be achieved through a process of frequent evaluation, training, monitoring and feedback sessions with key stakeholders (Chugh, 2016). This approach provides a framework for understanding the patterns and trends of potential risks and how they relate to the industry. A successful business should have efficient procedures, which include management and financial reporting systems. There many examples of organizations which have successfully managed their risks and turned the opportunities into concrete returns for the shareholders.

Risk refers to a likelihood, probability, a chance that a loss may occur in a given organization. Most of the times, there is a high risk when there is vulnerability. In this case, vulnerability refers to a weakness that the organization has. Risk assessment refers to the process of identification of potential hazards and proper analysis of the expected losses if those hazards occur (Homeland Security, n.d.). Risk assessment as a way of profiling risk according to impact to the organization. Some organizations have business impact analysis exercises geared towards determination of potential hazards based risk assessment approaches. Organizations’ risk differ depending on the size and the type of business they are doing. The disparity in organizations’ risk call for different adaptation of risk assessment approaches. Even with the disparities of the businesses, proper risk management not only ranks the risks according to the seriousness but also identifies the best methods to control risks in an organization.

Background- In its most basic sense, risk management identifies, allows assessment, and prioritizes risks that are associated and central to an individual project or organization. Risk management allows the organization to be proactive in preventing or mitigating risks, for improving certain processes within the organization, and with the hope of preventing fiscal exposure. However, in almost every organization there are risks individuals are unique and do not always perform at a high level of safety; mechanical or design failures exist, construction projects have supply or labor issues, there are uncertainties in computer or data modification, of course natural disasters, and even deliberate attacks from competitors, etc. Because this is such a common occurrence, national and even international standards have been developed in conjunction with the insurance and regulatory institutions to at least provide basic guidelines to minimize risks risk (International Organization for Standardization, 2009).

Because of rapid economic growth in XXX over the past years has increased the fear of major business failure, risk has become an overwhelmingly dominant business topic. As a result, top managers are now focusing on risk management in their companies. As each business entity struggles with its own set of needs and circumstances, the need and flexibility to address this continuously changing and volatile economic environment, would be extremely challenging and fulfilling to me.

“Enterprise risk management (ERM) is the process of planning, organizing, leading, and controlling the activities of an organization in order to minimize the effects of an organizations capital and earnings.” (ERM2007-2018) There are differences in the way a healthcare organization might use Enterprise risk management compared to a non-healthcare organization. For instance in healthcare a ERM program could help the healthcare leaders focus on better management of patients safety risks as well as business risks and, in turn, it could increase value of the organization. It could help prevent financial loss or could aide that organization in the investment to expand the services offered by the health-care organization.

Enterprise risk management is an approach to assist management to identify and manage uncertainties to obtain positive risk objectives. The ERM framework focuses on the development of a strategy that contains the importance of a risk and internal control

According to COSO "support from the board of directors and senior management is need to get the right focus, resources and attention for ERM" The entire corporation from top to bottom must view risk management as a critical and strategic step towards prosperity. And even though it is not the job of the directors to implement or be a part of risk management activities, they demonstrate clear support for ERM measures. It is up to top management to ensure that the resources are available, the focus is clear and the tone is positive and motivating.

According to IRM-AIRMIC-ALARM (2002), risk management actually defines every organisational strategic management; it comprises the process which identifies and treats the internal and external risks and adds sustainable value to the organisation and its stakeholders by decreasing the probability of not achieving the organisation’s overall objectives. The specific institutes suggest that risk management lies in the strategic, tactical and operational levels, and its embodiment in all tasks and roles is required; it is a consistent manner for an organisations’ operation, which leads to effective decision making, efficient allocation and protection of the organisational assets, and enrichment of the organisational

Enterprise risk management, also known as ERM, was introduced in 2004 as a strategy to manage risk within a company to avert future outcomes that can negatively affect the company and/or industry. As the concept, ERM spread it became widely accepted. According to the Embracing ERM, Practical Approaches for Getting Started, many companies thrived from adopting and implementing risk management. It was adopted by many to prevent systematic risk by planning, organizing, and controlling the companies’ activities. The 2013 COSO Enterprise Risk Management – Integrated Framework is not the same as the COSO Internal Control – Integrated Framework. The COSO Internal Control – Integrated

Risk management is the term applied to a logical and systematic method of establishing the context, identifying, analyzing, evaluating, treating, monitoring and communicating risks associated with any activity, function or process in a way that will enable organizations to minimize losses and maximize opportunities. (Lecture notes)Risk Management is also described as 'all the things you need to do to make the future sufficiently certain'. (The NZ Society for Risk Management, 2001)

The context inside of which the Group deals with the risks and key focus of accountability is as following by strategic risks are risks essentially created by occasions that are external to the Group, however significantly affect its strategic decision or activities. Accountability for leading strategic risks along these lines rests with the Board and President and Group CEO ("PGCEO"). The advantage of effectively managing strategic risk is that the Group can better forecast and rapidly adjust to the changing requests that are placed upon the Group. It additionally implies that the Group is less inclined to be influenced by some external occasion that calls for significant

Enterprise risk management (ERM) is a relatively new discipline that focuses on identifying, analyzing, monitoring, and controlling all major risk classes (e.g., credit, market, liquidity, operational risk classes). Operational risk management (ORM) is a subset of ERM that focuses on identifying, analyzing, monitoring, and controlling operational risk. The purpose of this paper is to explain what enterprise risk management is and how operational risk management fits into the ERM framework. In our conclusion, we discuss what is likely to happen in the ERM / ORM environment over the next 5 years. Introduction As

One well accepted description of risk management is the following: risk management is a systematic approach to setting the best course of action under uncertainty by identifying, assessing, understanding, acting on and communicating risk issues. In order to apply risk management effectively, it is vital that a risk management culture be developed. The risk management culture supports the overall vision, mission and objectives of an organization. Limits and boundaries are established and communicated concerning what are acceptable risk practices and outcomes. Since risk management is directed at uncertainty related to future events and outcomes, it is