Articles: Miscellaneous ERM Topics

  • Scenario Planning

    September 01, 2009

    Scenario planning is a tool that allows management to create in-depth contingency plans and move from a reactive to a proactive mindset. This Conference Board Review article explains the strength of scenario planning through its ability to generate several possibilities of future events, and modify those scenarios and related plans as the current state of the economy and world shift with time.

  • Uncertainty in Business

    July 01, 2009

    Uncertainty and ambiguity are a key challenge for business leaders today. Organizations are finding that they must increasingly plan for contingencies in the future instead of focusing primarily on short-term goals. In the past, many business leaders believed their organizations’ long-term goals could wait until they had dealt with the current crisis. In the current business environment, this is no longer the case. The rate of change has accelerated, indicating that business leaders must learn how to strike a balance between managing complex issues today and predicting the uncertain issues of tomorrow.

  • Internal Audit’s Role in Managing Reputation Risk

    June 01, 2009

    Reputational risks and corporate missteps are having more significant impacts on bottom lines and stakeholder perceptions of companies than ever before. Therefore, companies are recognizing the importance of reputational risk and placing a greater emphasis on reputational risk management. Internal audit departments can play a significant role in helping companies manage reputational risks through their advisory and monitoring efforts.

  • Outsourcing and Offshoring Decisions - Taking a Risk Intelligent Approach

    October 01, 2008

    When initiating the use of outsourcing and offshoring, companies should take a Risk Intelligent approach. In doing so, companies can better mitigate risks that develop from outsourcing and offshoring and optimize the benefits from such contracts. Companies should follow the steps within the outsourcing and offshoring lifecycle to when making outsourcing and offshoring decisions.

  • The New Treasury Diet: Keep It Simple

    April 01, 2008

    This article deals with the downturn in the auction-rate securities markets and suggestions for treasurers holding these securities.

  • We Will Never Have a Perfect Model of Risk

    March 16, 2008

    Former chairman of the Federal Reserve Alan Greenspan discusses why both risk and econometric models will never reach perfection. Business cycles and surprising discontinuities attribute to imperfection. Though these models helped past crises, Greenspan notes that the most reliable forms of managing against economic failure are market flexibility and open competition.

  • Overview of S&P Proposed ERM Evaluation

    February 04, 2008

    Standard & Poor's proposed expansion of ERM program evaluation to the nonfinancial sector has the potential to significantly affect the credit ratings process for firms in the seventeen industry sectors to be included in their revised analyses.

  • GRC Strategic Agenda: The Value Proposition of Governance, Risk, and Compliance

    February 01, 2008

    The increasing barrage of governmental, industry specific, and internal regulations, coupled with the pressures of increased competition and risk in a global market has clearly defined the need for organizations of all sizes to implement GRC initiatives. This article explains the need for GRC, GRC’s interconnectivity with IT, and the high level importance risk management plays in GRC initiatives.

  • Risk:  Dealing with Dangers Abroad

    January 01, 2008

    This article addresses challenges associated with managing global risks. Even with improved global communication technologies, better understanding of foreign cultures, and international advisors, breakdowns in strategies and operations now housed around the globe still occur. Despite the observation that prudent risk management suggests companies should select their foreign business operations carefully, surveys suggest that developed-market company executives responsible for risk management confess to not having a strategy in place to manage risks in emerging markets, with North American companies least likely. This article explores processes and techniques to strengthen an organization’s consideration of global risk management.

  • The Convergence of Physical and Information Security in the Context of Enterprise Risk Management

    December 31, 2007

    This report gives insight into the general state of security convergence, integration of converged security as part of ERM, role of risk councils, and benefits of converged risk management.

  • Reputation Risk Management

    December 01, 2007

    Corporations have started to take notice of the importance of reputation risk management, particularly in the past decade. Since 2000, research concerning reputation risk has more than doubled. A use of a top-down risk management strategy, as prescribed in an enterprise risk management strategy, as well as concentration on stakeholders are key parts of successful reputation risk management.

  • Standard & Poor’s Releases a Request for Comment on ERM

    November 15, 2007

    On Thursday, Nov. 15, 2007, S&P issued a request for comment on their proposal to include an assessment of corporate enterprise risk management practices as a key component of their overall credit ratings analysis for nonfinancial companies. S&P proposes to include ERM analysis into their corporate credit rating process as the principal methodology to evaluate management and to determine the overall business profile--a key factor in the S&P credit rating. Four major analytic components will comprise the S&P ERM evaluation. These include analyses of risk management culture and governance, of risk controls, of emerging risk preparation, and of strategic risk management.

  • Paulson Calls Housing Crisis the “Most Significant Risk” to Economy

    October 16, 2007

    In a speech at Georgetown University, U.S. Treasury Secretary Henry Paulson calls the current U.S. housing crisis the “most significant risk” to the U.S. economy.

  • Integrating SOX and ERM- Truths and Myths

    April 01, 2007

    For most organizations, the efforts being made to meet compliance regulations are not tied to current ERM processes. Procedures should be put in place to integrate compliance functionality into existing risk management plans.

  • Selecting Risk Consultants

    February 16, 2007

    Forrester recently published an article titled, Identifying and Selecting the Right Risk Consultant, that provides insight in making crucial decisions regarding selection of risk consultants. Just as the service needs of a company may vary, risk consultants provide service specialties that can be drastically different.

  • Managing Reputation Risk

    February 01, 2007

    Reputation is very important to most organizations, yet many companies do a poor job of managing risks to their reputation. Too often, companies focus their energy on addressing threats to their reputation that have already surfaced instead of proactively searching for potential reputation risks on the horizon.

  • Informatica’s Solution for Data Quality

    November 01, 2006

    Informatica released a white paper in November 2006 to summarize data quality problems faced by financial institutions trying to maintain compliance. Large corporations have an especially hard time integrating different areas of the business to establish clean reports that are useful. Additionally, the ever-changing nature of the data make the job of maintaining quality reports more challenging.

  • ERM Maturing in Australia and New Zealand

    November 01, 2006

    Companies in a variety of industries based in Australia and New Zealand were asked to rate their implementation of ERM. The survey found that a majority of companies in these countries had made strong improvements in the implementation of ERM in their organizations. The article examines the various strengths and weaknesses of ERM in the companies as seen by top management.

  • ERM:  Building on Section 404

    April 01, 2006

    Companies can gain a competitive edge from the close monitoring of all risks that comes from fully implemented ERM processes. Initial compliance with Section 404 of the Sarbanes-Oxley Act can benefit organizations in developing ERM in their organizations by providing the first step.

  • Outsourcing Decisions:  Taking an ERM Approach

    July 01, 2004

    Before outsourcing a business process or function, it is essential to assess the associated risks from an enterprise-wide risk management perspective. Poorly managed outsourcing decisions may ultimately increase, rather than decrease, total risk for an enterprise. An ERM approach to risk management is appropriate for managing the complexity of risks associated with outsourcing decisions.

  • Assessing Risks Before Outsourcing

    July 01, 2004

    Strategic Finance published an article titled, “Outsourcing? At your Own Risk,” providing statistics supporting an increase in the outsourcing of various business functions and the potential risks facing the enterprise. Businesses can make detrimental mistakes when only considering costs and not looking at other risks that the outsourcing creates when making decisions regarding outsourcing. Outsourcing decisions can affect risks related to several aspects of an enterprise, including market, operations, finance, human capital, IT, legal, and reputation risks. Taking an enterprise-wide view of risks is essential when dealing with outsourcing risks that can threaten stakeholder value.

  • ERM Education:  Role of MBA Programs

    July 31, 2002

    Enterprise risk management is being rapidly adopted by businesses around the world. However, colleges and universities are not acting as quickly to integrate the risk management strategies into undergraduate and MBA business curriculums.