Maintaining efficient operations to drive value and achieve long-term success
In today’s business climate, where management is expected to maintain agile and adaptive operations, an effective enterprise risk management (ERM) program is crucial to help shape business objectives, drive revenue growth and ensure long-term success. When successful, an ERM program integrates risk management principles and business strategy to execute risk-based decisions and solutions.
By developing risk mitigation, measurement plans and risk management frameworks—and using governance, risk and compliance technologies as a foundation—organizations will be able to establish a risk management program capable of assessing risk from strategy through execution across all areas of the business.
The ERM program allows for better risk management and gives organizations the chance to explore new opportunities to drive performance and use resources in a more effective way.
Instead of changing strategy after a poor performance period or at regularly scheduled intervals, organizations need to design a performance-focused risk management program that allows management to better monitor and prepare for the ever-evolving business environment.
To make calculated decisions in a effective manner, organizations need to understand the risks associated with three key aspects of the strategy and throughout its development.
Establishing a strong company risk culture and stressing the importance of managing risk encourages a clear and proper flow of risk information. Understanding the risks and capabilities required to be successful in various scenarios will give you the agility to adapt quicker when they occur.
ERM focuses on identifying risk areas or situations likely to have high reputational impact. These risk situations, when not managed properly and in a timely manner, could cause financial losses and more importantly, damage an organization’s long-term credibility.
Originally developed in 2004 by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), the COSO ERM – Integrated Framework is one of the most widely recognized and applied risk management frameworks in the world. After a decade of experience with the Integrated Framework, COSO set out to update it to further address the alignment of risk, strategy and performance. COSO re-engaged PwC to serve as the project team. The 2017 updated Framework is called Enterprise Risk Management—Integrating with Strategy and Performance.
PwC guides you through the development of strategies and action plans that are effective in managing, reducing or avoiding risks. We will help you determine client, enterprise and business unit priorities, communicate expected performance through KPIs and performance tools, conduct relevant research to identify emerging trends, facilitate management discussions with risk data and design integrated assurance coverage across the enterprise through risk, compliance, and internal audit teams.