Enterprise risk management, important but neglected

Enterprise risk management is increasingly important as a tool to analyze and confront risks with 91% of risk management executives approximately 247 of the 271 surveyed by the Conference Board and risk management consulting firm Mercer Oliver Wyman inclined toward accepting ERM or actively preparing, developing or implementing the practice. While the practice has gained acceptance in theory, only 11% of the respondents have implemented ERM throughout their Company.The most common ERM element, implemented by 22% of respondents, is determining risk mitigation strategies within the business units. However, establishing a business risk inventory is only utilized by18% of the respondents and only 15% are developing a common language for risk exposure. In addition, only 14% of the report the ability to adequately communicate risk expectations to senior managers.”Competing priorities” is another challenge reported by 26% of respondents. Also impeding ERM, according to12% of those surveyed, is insufficient resources. Ten percent claim there is a lack of consensus on the benefits achieved from ERM’s. Full ERM implementation, according to small group of risk management executives who have achieved full implementation, will help actualize: “better-informed decisions,” according to 86% of those surveyed; greater management consensus according to 83%; and, increased management accountability and smoother governance practices according to 79% of respondents.