Enterprise Wide Risk Management - The New Frontier

Abstract

The Study of practices and theories of risk management and the classic definition of risk which defines it as uncertainty of loss, shows that the risk management discipline, as it has grown and now stands, is a Faculty where in phenomenon of risk has to be controlled in the principle of enterprise itself and wherein profit has to be made from the management of uncertainty. At present, many risk management programs attempt to provide a level of assurance that the most significant risks are identified and managed. However, they frequently fall short in aggregating and evaluating those risks across the enterprise from a strategic perspective. The emerging concept of Enterprise risk management provides an effective window where in all perspectives of risks emerging out of various situations and scenarios are integrated and comprehended in totality. Effective enterprise risk management represents a sophisticated, full-fledged management discipline that links risk to shareholder value and correlates with the complexity of the organization and the dynamic environments in which it operates. This paper studies in depth the evolution of Risk management, its role in the contemporary scenario and how the concept of Enterprise Risk management is revolutionizing the discipline of Risk management.

Keywords: Risk, Risk Management, Basel II & III, ERP, SAP

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