The Eightfold Path for Enterprise Risk Management

My last post discussed what the ERM ideal might look like. Just released by RIMS, my article "The Eightfold Path for Enterprise Risk Management", provides eight key objectives and implementation concepts.

The following desired attributes for an ERM program will guide our approach:

1. ERM frameworks must capture all risk categories and assess them in a manner that resonates with key decision makers.
2. Risk management processes should leverage existing, effective business processes and minimize overlap.
3. ERM should guide future capital allocation decisions across business lines or products.
4. An effective framework should provide risk-adjusted business valuations and performance measurements.
5. Risk management should be embedded in operations, tactics and strategy.
6. ERM should include the management of “upside” risks and drive the achievement of business objectives.
7. ERM should articulate and operationalize risk tolerances relating to risk categories and specific levels of exposure at the business unit and enterprise levels.
8. A risk management framework should be able to adapt to new technology, changing markets and new ways of doing business. A robust framework should include learning mechanisms and account for the “meta-risk” of cognitive biases among SMEs and risk managers.

Please read the full article here:

https://www.rmmagazine.com/2017/11/08/the-eightfold-path-for-enterprise-risk-management/