What is an enterprise risk profile

What are the benefits of ERM? The benefits of ERM including the writing of your enterprise risk profile are making better decisions more often.

An enterprise risk profile is a written enterprise wide assessment of the key threats and opportunities an enterprise is exposed to within a specific period of time in the future. It is used to focus limited enterprise assets on the issues that matter most in the pursuit of enterprise business objectives. Your enterprise risk profile should be revisited periodically after it is written to ensure it remains relevant in the drive to perform well and resiliently whatever the business environment. It should help make an enterprise more efficient and more productive.

What are the 3 types of enterprise risk

The 3 main types of enterprise fall into the following categories:

• Strategic risks
• Operational Risks
• Project risks

Your enterprise risk management process should encompass all key risks to your enterprise in these 3 categories.

How do you write a risk profile

Your enterprise risk management process should identify analyse and assess the severity of impact of potential future risk events on the achievement of your enterprise business objectives and the likelihood of those risk events occurring within a specific risk exposure timeframe. Understanding your enterprise risk profile will provide risk management insight and facilitate improved enterprise decision-making building enterprise resilience and a path to greater success.

Preparing your enterprise risk profile should take account of your enterprise risk management culture. Writing an enterprise risk profile based on another company’s way of tackling risks is likely to fail at risk management plan implementation stage and result in wasted time on the enterprise risk management process and poor risk management practice within your organisation. It may for these reasons be foolish to follow another ERM model adopted by another business instead of designing your own.

Who is responsible for enterprise risk management

Everyone in your organisation, everyone in your supply chain and all your contractors or business partners are responsible for enterprise risk management in your business planning and risk management implementation. To undertake an effective holistic enterprise wide risk management approach to business requires the engagement of all parts of the business that contribute to the level of risk in your business activities. Failure to engage all relevant parts of your business activities will leave a gap through which opportunities will be lost and threats will fester.

When you know what all your key risks are you can then decide which ones to tolerate or accept, which ones you are forced to accept in order to be in business and which ones you have the capacity to take to achieve more.

Create support and train the right people in your enterprise risk management framework to take responsibility for managing enterprise risks

Risk ownership and risk monitoring in accordance with your executive risk appetite and tolerance and holistic knowledge of enterprise wide key risks is crucial to effective enterprise risk management. Your enterprise risk management strategy should at least be aligned with your agreed business planning and business strategy. Ideally your enterprise risk management plan should drive all business planning and business strategy setting.

Your enterprise risk management capability

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Enterprise Risk Profile