Airmic to research and measure the value of enterprise risk management
In-depth research on enterprise risk management (ERM) is expected to be completed in early 2008, according to Airmic.
The research is designed to measure the worth of ERM and the circumstances under which it adds most value and will be conducted by Det Norske Veritas in cooperation with Airmic.
To date eight organisations have confirmed their participation, including the Royal Mail, Metropolitan Police, Liverpool John Moores University, the Highways Agency and Nestlé. Another five are in discussions with Airmic.
Airmic chairman Geoff Taylor said: “An enormous range of people and organisations from social workers to global corporations all claim to practise risk management, but we lack a shared understanding of what it means. We need to bring clarity to an overused concept and demonstrate how best to go about ERM.
“In my experience, ERM can bring huge advantages to organisations, helping them to become more effective and enterprising. But, like anything else, there’s a world of difference between good and bad practice.
“I see this report becoming a reference point for risk managers, businessmen, government and anyone else with an interest in risk,” added Taylor.
Researchers will study the circumstances that contribute to variations in its effectiveness, and they are looking to produce a checklist to assist practitioners.
Paul Howard, chair of the risk management steering group at Airmic, pointed out the research hopes to bring together detailed case studies to show risk managers how ERM works and its applications.
David Salmon of DNV said: “Boards rightly wish to be reassured as to the value of enterprise risk management. We intend to provide an insight into what works that provides practical support to anyone involved."
Taylor predicted that it was a question of time before risk management at an enterprise level swept through the industry, as in the case of the banking sector and the pharmaceutical and food industries.