Enterprise Risk Management
A ‘risk-intelligent’ approach
Effective governance is a critical aspect of a successful business: it supports management in delivery of the strategy, managing costs, attracting investment, making better decisions and responding to risk. There has never been more focus on how organisations identify and manage risk.
From regulators to investors to senior executive management, companies are under pressure to be able to clearly articulate how they identify the principal risks to their business and how they ensure these are being managed within their risk appetite.
In our latest paper we present our thoughts on enhanced ERM approaches supported by the Deloitte Risk Intelligent philosophy. We outline some recent changes in governance requirements, and some of our latest thinking on ERM that will enable you to assess your organisational risk maturity and support a way forward.
Companies need to take risks to create value, and manage risks to protect value. There is a range of ‘optimal risk taking’ which supports maximum return – ‘the Sweet Spot’ – and effective risk management is about ensuring that the risks an organisation takes are the right ones and that they are appropriately managed.
Top-quartile companies are focused on operating in the Sweet Spot by ‘risk-intelligent’ decision-making – i.e. by measuring and managing key risks effectively and efficiently in the context of decisions both taken and not taken.