The Importance Of Risk Management Function Within Businesses

1044 WordsNov 10, 20155 Pages
Part A: State-of-the-Art-Review Risk Management is the process of recognising, measuring, and handling the risks that an organisation faces. As the outcomes of business activities are uncertain, there are some forms of risk taking place, for example: strategic failures, operational failures, financial failures, market disturbances, environmental disasters, and regulatory violations. (Lexicon.ft.com, 2015). Trends Many institutions have evolved into more complex and sophisticated when it comes to risk management functions due to the fact risk management has become more important in organisations. The role of role managers is more senior and more powerful because of the amount of decisions it has to make. Another key element of the development of the risk management function within businesses is because of the increased awareness that risk management is an “organisational discipline” as a set of functions performed by a specific part. This reflects the recognition that risk management is essential in all trading and other activities that entail risk assumption. This means that all traders and other employees have the ability to perform risk management functions, which is a component of each activity within the business. In this method, risk management performs a policy role and direction. Risk management in the widest sense is fixed within the organisation and its management processes. (The Risk Management Function (1) In 2009, the company Accenture, which is one of the
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