Enterprise Risk Management
We identify potential risks to your strategic objectives.
We work directly with your leadership and board of directors in a strategic setting by applying the fundamental elements of Enterprise Risk Management. We support the identification, assessment and prioritisation of any significant risks or events that may have an impact of your organisational strategic objectives. We focus on achieving a coordinated and economical application of resources to minimise, monitor and control the probability and impact of adverse events.
We take a risk-based approach to managing an enterprise, integrating concepts of internal control and strategic management. We embed an ERM framework in the ongoing activities of your organisation, with the important concepts of risk strategy, risk culture and risk appetite. You will then be taking action to improve your organisational performance in the face of challenges.
These are expressions of the attitude to risk in an organisation - and of the amount of risk that the organisation is willing to take are important elements of governance responsibility.
Why Enterprise Risk Management?
Enterprise Risk Management provides a framework for risk management, which typically involves identifying particular events or circumstances relevant to the organisation's objectives (threats and opportunities), assessing them in terms of likelihood and magnitude of impact, determining a response strategy, and monitoring process.
By identifying and proactively addressing risks and opportunities, business enterprises protect and create value for their stakeholders, including owners, employees, customers, regulators, and society overall.
The Value Propositions
Effective governance is a critical aspect.
Effective governance is critical aspect of a successful business. It supports strategic 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 risk to their business and how they ensure these are being managed within their risk appetite. ERM facilitates effective risk governance.
Organisations start an endeavour to take an opportunity.
There is uncertainty about any opportunity an organisation will take. Each endeavour has an associated risk. That is where Enterprise Risk Management plays a significant role. Organisations need to increase their risk-taking capability to cash in on opportunities. With a robust ERM program/framework, organisations can identify and analyse risks and decide which risk is worth taking.
ERM determines the life of the enterprise.
ERM is important for an organisation because its success determines the health and life of the enterprise. If an organisation fails to identify risks to its existence, it will be ill-prepared to face any risk events and that will impact their performance.
Traditional risk management approaches tend to be fragmented by compartmentalising risks into silos.
These approaches often limit the focus to managing uncertainties around physical and financial assets. Because they focus largely on loss prevention, rather than enhancing enterprise value, traditional approaches do not provide the framework most organisations need to redefine the risk management value proposition in a rapidly changing world. ERM, on the other hand, provides an organisation with the process it needs to become more anticipatory and effective at evaluating and managing the uncertainties it faces as it creates sustainable value for stakeholders.
ERM focuses on establishing sustainable competitive advantage.
ERM helps management overcome silo behaviour by aligning and integrating varying views of risk and enabling the enterprise to successfully respond to a changing environment. ERM elevates risk management to a strategic level by broadening the application and focus of the risk management process to all sources of enterprise value, not just physical and financial ones.
ERM optimises the cost of managing risk.
Through ERM, management aggregates risk acceptance and transfer decisions, eliminates redundant activities and determines the level of risk the organisation is prepared to accept as it executes its business model.
ERM helps management improve business performance.
ERM assists management with reducing unacceptable performance variability and loss exposure, by anticipating the impact of major events and developing responses to prevent those events from occurring - and manage their impact on the organisation if they do occur.
ERM transitions risk management to protecting and enhancing enterprise value.
ERM transitions risk management from “avoiding and hedging bets” to a differentiating skill for protecting and enhancing enterprise value as management seeks to make the best bets in the pursuit of new opportunities for growth and return.
ERM invigorates opportunity-seeking behavior.
ERM invigorates opportunity-seeking behavior by helping managers develop the confidence that they truly understand the risks they are taking on, and have the capabilities at hand within the organisation to manage those risks.
The focus of ERM is on integrating risk management with strategy-setting.
The emphasis is on identifying future potential events that can have both positive and negative effects, and evaluating effective strategies for managing the organisation’s exposure to those future events. ERM transforms risk management to a proactive, continuous, value-based, broadly focused and process-driven activity. These contributions redefine the value proposition of risk management to a business.
Research over the years constantly indicates that six of ten senior executives “lack high confidence” that their company’s risk management practices identify and manage all potentially significant business risks.
How We Do It
We develop an Enterprise Risk Management framework which includes the policy & procedures that defines the processes for the identification, assessment, and response to the risks along with the subsequent monitoring. It also includes the roles and responsibilities defined for the people who manage the risks for the organisation.
With a combination of people, process and technology where the risk management team follows the set of processes, as defined in the policies, and with the help of risk management tools, we help your organisation to smoothly conduct the Enterprise Risk Management program. This is per the framework defined by the organisation, with timely reporting to those in charge of governance, such as the board of directors and audit committees.
We are a specialised risk management consultancy implementing the latest technologies and best practices for businesses to manage their risks, build their business resilience and accelerate their growth.
The Vision of Eagle Edge is to be the catalyst for risk transformation, resilience creation and growth acceleration of our client's enterprise value. We turn risks into opportunities.
Creation of a more risk focused culture for the organisation.
Organisations that have implemented Enterprise Risk Management remark that increasing the focus on risk at the senior levels results in more discussion of risk at all levels. The resulting cultural shift allows risk to be considered more openly and breaks down silos with respect to how risk is managed. As risk discussions develop into a standard part of the overall strategic business processes, operational units often find that addressing risk in a more formal way help manage their part of the organisation as well. Communication and discussion of risk is recognised as not only a process to provide information to senior management, but also a way to share risk information within and across operations of the company, and allow better insights and decision-making concerning risk at all levels.
Standardised risk reporting.
Enterprise Risk Management supports better structure, reporting, and analysis of risks. Standardised reports that track enterprise risks can improve the focus of directors and executives by providing data that enables better risk mitigation decisions. The variety of data (status of key risk indicators, mitigation strategies, new and emerging risks, etc.) helps leadership understand the most important risk areas. These reports can also help leaders develop a better understanding of risk appetite, risk thresholds, and risk tolerances. One of the major values of Enterprise Risk Management risk reporting is improved, timeliness, conciseness, and flexibility of the risk data. This provides the data needed for improved decision-making capabilities within the executive and director levels, and in other layers of management. Enterprise Risk Management helps management recognise and unlock synergies by aggregating and sharing all corporate risk data and factors and evaluating them in a consolidated format.
Improved focus and perspective on risk.
Enterprise Risk Management develops leading indicators to help detect a potential risk event and provide an early warning. Key metrics and measurements of risk further improve the value of reporting and analysis and provide the ability to track potential changes in risk vulnerabilities or likelihood, potentially alerting organisations to changes in their risk profile. Enterprise Risk Management also permits a more complete viewpoint on risk. Traditional risk practices focus on mitigation, acceptance, or avoidance. However, effective Enterprise Risk Management processes gives management a framework to evaluate risk as an opportunity to increase competitive positions and exploit certain market and operational conditions.
Efficient use of resources.
In organisations without Enterprise Risk Management, many individuals may be involved with managing and reporting risk across operational units. While developing an Enterprise Risk Management program does not replace the need for day-to-day risk management, it can improve the framework and tools used to perform the critical risk management functions in a consistent manner. Eliminating redundant processes improves efficiency by allocating the right amount of resources to mitigating the risk.
Effective coordination of regulatory and compliance matters.
Insurers, financial auditors, and regulatory examiners, have begun to inquire about, test, and use monitoring and reporting data from Enterprise Risk Management programs. Since Enterprise Risk Management data involves identifying and monitoring controls and mitigation efforts across the organisation, this information can help reduce the effort and cost of such audits and reviews.