What does an effective ERM program look like?
In part 1 of our exploration of the top 10 risk management fundamentals, we reviewed ERM basics such as program setup and documentation, ERM roles and responsibilities, and more. Next, we’ll take a look at five more program elements that help establish a comprehensive approach to assessing and managing risk.
“When an organization has effective ERM, their ability to make better business decisions is greatly enhanced,” says Quantivate Vice President of ERM Services William Hord. “Because they are implementing those decisions with risk in mind, that saves time and capital resources.”
Let’s take a tour of some techniques for measuring, monitoring, and maintaining your ERM program that will help your organization make informed, risk-based decisions.
*click to jump to section
* See Building an ERM Program: Top 10 Risk Management Fundamentals, Part 1
Risk Appetite Statement Process:
Risk appetite thresholds set a lower bound (minimum amount of risk) and an upper bound (maximum amount of risk) that your organization is willing to accept.
Key Performance Indicators (KPIs)
Key Risk Indicators (KRIs)
Learn more → Developing Key Indicators
Establish reporting lines for:
Develop training processes for:
Opportunities for training:
Look for potential areas where you can improve and mature your ERM program.
Typical next steps include:
In this two-part series, we’ve explored some of the risk management elements than can help any organization create, maintain, or mature their ERM program. Hopefully this outline has helped you get a broad overview of what a well-developed program looks like and start thinking about which elements might be missing within your organization. If you’re interested in accelerating your ERM capabilities, let us know, and we’ll connect you with information about Quantivate’s ERM Software and consulting services.
20250 144th Ave NE, Suite 300
Woodinville, WA 98072