Enterprise Risk Management#
What is ERM?#
Enterprise Risk Management is a coordinated approach to identifying, assessing, and managing risks across the organization.
ERM Framework#
1. Risk Governance
- Board oversight
- Risk committee
- Chief Risk Officer
2. Risk Strategy
- Risk appetite
- Risk tolerance
- Risk policy
3. Risk Identification
- Internal risks
- External risks
- Emerging risks
4. Risk Assessment
- Likelihood
- Impact
- Risk rating
5. Risk Response
- Avoid
- Mitigate
- Transfer
- Accept
6. Monitoring and Reporting
- Key risk indicators
- Risk dashboards
- Board reporting
Types of Risks#
- Strategic Risk
- Operational Risk
- Financial Risk
- Compliance Risk
- Reputational Risk
Risk Management Process#
- Establish context
- Identify risks
- Analyze risks
- Evaluate risks
- Treat risks
- Monitor and review
Benefits of ERM#
- Better decision-making
- Improved resilience
- Regulatory compliance
- Stakeholder confidence