Chapter
The difference between taking managed and unmanaged risks
Benefits of well-managed enterprise
risk management
Questions for senior management and
the board to ask
02 About
enterprise risk management
Implementing the programme for ERM
Essential attributes of ERM for delivering value and capacity
Top level leadership in ERM
Identifying risk: types of risk, risk
lists and taxonomies
Evaluating and prioritizing risk
Governance, risk and compliance
Questions for senior management and
the board to ask
03 Risk as an opportunity/threat to objectives and value drivers
Risk – opportunities and threats
Threat and opportunity management
Differentiating between objectives, strategic goals and value drivers
Questions for senior management and
the board to ask
04 Implementing
an ERM programme
Establish the foundation – the operating model for ERM
Language, oversight and governance
Building capabilities: assess and develop responses and capabilities
Improving capabilities: monitoring
and communication
Questions for senior management and the board to ask
05 Risk attitude, risk propensity and risk appetite
Risk aversion versus risk hungry
Applications of a risk appetite tool
Risk capacity versus tolerance
Developing risk appetite frameworks
The risk of not taking a risk
Risk appetite and value drivers
Organization behind the setting
of risk appetite
Examples of risk appetite statements
Questions for senior management and
the board to ask
06 ERM culture, blame, boundaries and elephants in the room
ERM cultures and the blame culture
Using risk appetite as a tool to
destroy the blame culture
The link between managed risk taking, mice, Maslow and Herzberg
The elephant in the room and conduct risk
Questions for senior management
and the board to ask
07 Embedding and integrating ERM
What does embedding mean?
Main aspects of embedding ERM
A 16-step plan for embedding ERM
Questions for senior management and the board to ask
08 Maturity in enterprise risk management
How risk maturity enables managed
risk taking
Action plan for measuring and tracking performance
Questions for senior management and the board to ask
09 Resilience and sustainable habits
Business continuity management
The role of senior management
Corporate social responsibility
Questions for senior management and
the board to ask
10 Learning and communication
Questions for senior management and
the board to ask
11 Conformance, performance, roles, responsibilities and regulations
Managing conformance versus performance
The role of boards in ERM
The role of internal and external audit
in ERM
Compliance requirements for risk management: various countries
and industries
Questions for senior management and
the board to ask
12 Deliverables from quantitative ERM approaches
Models for valuing risk and capital
Own risk and solvency assessments –
a useful model
Stress testing and reverse stress testing
Risks that cannot be valued
Questions for senior management and
the board to ask
13 Simple, elegant ERM tools for senior management
The triangle of risk – trigger, environment, strength or weakness
Using cause and consequence analysis to transform risk approach
Macro and micro risk management
Questions for senior management and
the board to ask
14 ERM and performance management synergies
Risk management alignment within the organization
Performance management methods
Questions for senior management and the board to ask
15 The key strategic questions for senior management and boards to ask themselves
Recognizing the risks of versus the
risks to the strategic plan
The key strategic questions
Section C: Accountability
Section E: Relations with shareholders
Information and communication
7. Annual General Meeting
8. Reporting responsibilities
Enterprise risk management roles
and accountabilities
Appendix 1. Examples of corporate governance and ERM regulations
Appendix 2. The main principles of the UK Code of Governance, October 2012
Appendix 3. Summary COSO guidance
Appendix 4. Case study: Applying a more granular mathematical model to a risk for a non-financial organization
Appendix 5. Capital and risk considerations for US insurers, from NAIC ORSA Guidance
Appendix 6. Sample terms of reference for a board risk committee
Appendix 7. Example of roles of CRO and ERM team
Practical Enterprise Risk Management
：How to Optimize Business Strategies Through Managed Risk Taking
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