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Enterprise Risk Management Overview

Enterprise risk management (ERM) is defined as a process designed to identify potential events that may affect an entity and manage risk within its risk appetite to provide reasonable assurance of achieving objectives. Key elements of ERM include analyzing and identifying risks, measuring risks, and monitoring risks. The value of ERM is that it allows an entity to achieve its targets and prevent losses while ensuring compliance from a broad perspective. Implementing ERM requires overcoming challenges like complexity, requiring transition from theory to action plans, and potential turf wars between departments. An ERM program requires designating an ERM officer, developing an ERM roundtable, creating a strategy matrix, and applying risk management steps across the entire enterprise.

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Bhargav Rishabh Baruah
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74 views13 pages

Enterprise Risk Management Overview

Enterprise risk management (ERM) is defined as a process designed to identify potential events that may affect an entity and manage risk within its risk appetite to provide reasonable assurance of achieving objectives. Key elements of ERM include analyzing and identifying risks, measuring risks, and monitoring risks. The value of ERM is that it allows an entity to achieve its targets and prevent losses while ensuring compliance from a broad perspective. Implementing ERM requires overcoming challenges like complexity, requiring transition from theory to action plans, and potential turf wars between departments. An ERM program requires designating an ERM officer, developing an ERM roundtable, creating a strategy matrix, and applying risk management steps across the entire enterprise.

Uploaded by

Bhargav Rishabh Baruah
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
  • What is ERM?
  • Introduction
  • ERM Key Elements
  • Elements of ERM Framework
  • The Value of ERM
  • Roadblocks
  • How to Achieve ERM within your Facility
  • Role of ERM Risk Officer
  • Develop an ERM Roundtable
  • Develop a Strategy Matrix
  • Conclusion
  • Closing Remarks

ENTERPRISE RISK

MANAGEMENT
By – Bhargav Rishabh Baruah
Kunal Singh
Chandan Kumar Basumatary
Anil Lakra
Rahul Saha
What is ERM?

Enterprise Risk Management (ERM) is defined by the Committee of


Sponsoring Organizations (COSO) as “a process, effected by an entity’s
board of directors, management and other personnel, applied in
strategy-setting and across the enterprise, designed to identify
potential events that may affect the entity, and manage risk to be
within its risk appetite, to provide reasonable assurance regarding the
achievement of entity objectives.”
ERM Key Elements

• Analyzing and identification of risk.


• Measurement of risk.
• Risk Monitoring.
Elements of ERM Framework

• Education and Internal Environment


• Objective Setting
• Event Identification
• Risk Assessment
• Risk Response
• Control Activities
• Information and Communication
• Monitoring
The Value of ERM
• The underlying premise of ERM is that every entity exists to provide value for its stakeholders

• Stakeholders of not-for-profit entities realize value when they recognize receipt of valued social
benefit—i.e. “the Mission”

• A key to achieving that social benefit and a key to survival is to identify and manage risk across the
enterprise rather than narrowly focusing in certain “traditional” risk areas

• ERM facilitates an entity’s ability to achieve its performance and profitability targets; it prevents loss
of resources; it ensures compliance with laws and regulations; avoiding damage to reputations, and
achieving corporate goals and objectives – and does this from a broader perspective than traditional
RM
Roadblocks

• Complex & takes time


• Needs transition from Theory to Action plan
• Requires combined knowledge and focus – legal,
financial, internal audit, clinical, insurance,
compliance, operations, etc.
• Turf Wars between departments and divisions can
occur
• Requires a new paradigm
How to Achieve ERM within your Facility
• Embrace “enterprise-wide” risk oversight
• Require that RM evaluate risk issues from new strategies well in
advance of implementing those strategies
• Foster a collaborative effort to address risk and quality concerns –
and to make pro-active decisions including risk management
considerations as well as operational strategies
• Determine and assign authority levels for managing risks
• Facilitate open communication of risk
Role of ERM Risk Officer
• Establish ERM policies and set goals for implementation
• Frame accountability and authority
• Promote ERM competence throughout the entity
• Guide integration of ERM with other business planning and
management activities
• Oversee development of entity-wide and business unit
specific risk tolerances
• Facilitate managers’ development of reporting protocols
(ERM Roundtable)
• Report to senior leadership on progress and recommend
action as needed
Develop an ERM Roundtable

IT

HR Compliance

Affiliates Legal

Medical
Operations
Staff
Chief
Risk
Officer

Faculty &
Research
Students

Marketing Finance

Internal Quality/
Audit Safety
Develop a Strategy Matrix
• Define key organizational short and long term goals
• Strategic
• Operational
• Financial
• Map key risk management issues that will support goals
or that could threaten the goals
• Identify and prioritize risk management strategies
• Document assignments of responsibility and timelines for
achieving goals and objectives
Strategy Matrix

Mission

Objectives

Strategic Operational Financial

Strategies

Risk Management Issues

Quality Loss Control Reporting Compliance

Prioritize and apply RM Steps across the Enterprise

Action Plan to further objective/prevent failure of objective


CONCLUSION
Enterprise Risk Management is the discipline by which
an organization in any industry assesses, controls,
exploits, finances, and monitors risks from all sources
for the purpose of increasing the organization’s short
and long-term value to its stakeholders.
THANK YOU

ENTERPRISE RISK MANAGEMENT By – Bhargav Rishabh Baruah Kunal Singh Chandan Kumar Basumatary Anil Lakra Rahul Saha
Enterprise Risk Management (ERM) is defined by the Committee of Sponsoring Organizations (COSO) as “a process, effected by an
ERM Key Elements • Analyzing and identification of risk. • Measurement of risk. • Risk Monitoring.
Elements of ERM Framework • Education and Internal Environment • Objective Setting • Event Identification • Risk Assessment •
The Value of ERM • The underlying premise of ERM is that every entity exists to provide value for its stakeholders • Stakehol
Roadblocks • Complex & takes time • Needs transition from Theory to Action plan • Requires combined knowledge and focus – leg
How to Achieve ERM within your Facility • Embrace “enterprise-wide” risk oversight • Require that RM evaluate risk issues fro
Role of ERM Risk Officer • Establish ERM policies and set goals for implementation • Frame accountability and authority • Pro
Develop an ERM Roundtable Chief Risk Officer IT Compliance Legal Medical Staff Faculty & Students Finance Quality/ Safety I
Develop a Strategy Matrix • Define key organizational short and long term goals • Strategic • Operational • Financial • Map k

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