The role of top management and the board in ERM
Enterprise risk management is at its most effective when it informs every aspect of the business and when the ERM framework is continually evaluated and updated. A key objective for senior management and board members should be to foster a risk-aware culture across the organization, and to actively monitor and update ERM. Among our study’s Trendsetters—companies that are most proficient at creating value through ERM—management and the board ensure that ERM is fully integrated into the strategic decision-making process and regularly review the ERM framework to ensure progress remains constant.
Our survey of 125 North American companies showed that no less than 94% of Trendsetters have their risk management practice embedded in the strategic planning process. Only 57% of Transitionals and 32% of Beginners were able to make that claim.