3 Why is an Enterprise Risk Management framework needed?
A key part of ERM is identifying how much risk you are prepared to take (your risk appetite). You have also seen that ERM is a process that requires board involvement and the involvement of other people in an organisation. Enterprise Risk Management reaches strategic, compliance, financial reporting and operational aspects across an organisation.
This wide-ranging scope of ERM means that many companies find it helpful to design a framework, wherein the different elements are complementary and supportive of one another. In the best organisations, risk management is built in to other activities rather than being a bolt on, and so their ERM framework is interwoven with other elements of the way they do business.