The Evolution of Internal Audit’s Role in Enterprise Risk Management: Integration of Theoretical Development and Empirical Evidence

Xiwen Liang ()
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Xiwen Liang: Dongbei University of Finance and Economics, School of International Business

A chapter in Proceedings of the 2026 6th International Conference on Enterprise Management and Economic Development (ICEMED 2026), 2026, pp 409-416 from Springer

Abstract: Abstract Against escalating business complexity and global uncertainty, internal audit’s role in enterprise risk management (ERM) has profoundly evolved from a financial compliance watchdog to a strategic risk advisor and integrator. This paper systematically reviews the theoretical evolution of this role and synthesizes cross-country, cross-industry empirical evidence. The findings reveal that internal audit’s expanded functions—core assurance, legitimate consulting, and strategic integration—significantly enhance ERM effectiveness, organizational resilience, and governance quality, while reducing operational and financial risk. However, persistent challenges include role ambiguity, competency gaps, resource constraints, and integration barriers across diverse contexts. By providing an integrated framework of this evolutionary path, this study addresses the fragmentation in existing research and offers actionable insights for optimizing internal audit’s contribution to modern ERM systems, while identifying critical gaps for future research.

Keywords: Internal Audit; Enterprise Risk Management; Role Evolution; Theoretical Development; Empirical Evidence; Corporate Governance; Risk Governance (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6239-719-4_47

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DOI: 10.2991/978-94-6239-719-4_47

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