The purpose of enterprise risk management is to manage risk consistently and constructively across an organization’s functions and business units. To accomplish this, ERM typically incorporates the following components.

  • Agreed risk management goals, objectives and metrics
  • Assignment of roles and responsibilities for managing risk
  • Board-level policy setting concerning risk appetite and risk tolerance
  • Thorough communications about risk issues up and down the organizational hierarchy
  • A consistent, ongoing approach to identifying and evaluating risk
  • A better balance of risk and reward in decision-making
  • Development of risk mitigation action plans at all appropriate levels
  • An efficient structure to embed risk awareness, processes and common terminology throughout the organization

Understanding the basic requirements of an ERM program does not guarantee its ultimate success. Deriving the full value from ERM is achieved through successful implementation.

Willis In History

Did you know Willis was the insurance broker for the first commercial service of the Airbus A380, as operated by Singapore Airlines on 25 October, 2007?