Implementing ERM: What Boards Must Consider

The Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) recently released a white paper discussing the role of the Board of Directors in an effective Enterprise Risk Management (“ERM”) program.  It provides an overview of the key drivers for implementing ERM today and what Boards must consider during the implementation.  Here is what they suggest.

In the aftermath of the financial crisis, executives and their boards realize that ad hoc risk management is no longer tolerable and that current processes may be inadequate in today’s rapidly evolving business world. Boards, along with other parties, are under increased focus due to the widely-held perception that organizations encountered risks during the crisis for which they were not adequately prepared. Increasingly, boards and management teams are embracing the concept of enterprise risk management (ERM) to better connect their risk oversight with the creation and protection of stakeholder value.

While ERM is not a panacea for all the turmoil experienced in the markets in recent years, robust engagement by the board in enterprise risk oversight strengthens an organization’s resilience to significant risk exposures. ERM can help provide a path of greater awareness of the risks the organization faces and their inter-related nature, more proactive management of those risks, and more transparent decision making around risk/reward trade-offs, which can contribute toward greater likelihood of the achievement of objectives.

If your company is considering implementation of an ERM program or simply looking to enhance your current ERM program, Wheelhouse Advisors can help.  To learn more, visit



About Wheelhouse Advisors
Wheelhouse Advisors LLC is the publisher of The ERM Current™, an online publication and blog dedicated to providing the latest updates on current trends in Enterprise Risk Management & Control. Wheelhouse Advisors provides cost-effective Enterprise Risk Management & Control solutions to both large and mid-size corporations. To learn more about Wheelhouse Advisors, please visit our web site at

One Response to Implementing ERM: What Boards Must Consider

  1. PSI says:

    Nice article about Implementin ERM.
    A central goal and challenge of ERM is improving this capability and coordination, while integrating the output to provide a unified picture of risk for stakeholders and improving the organization’s ability to manage the risks effectively. The following are some common challenges in ERM implementation, Identifying executive sponsors for ERM, Establishing a common risk language or glossary, Establishing ownership for particular risks and responses.

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