Enterprise Risk Management: Improving Embedded Risk Management and Risk Governance

Werner Gleißner and Thomas B. Berger ()
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Werner Gleißner: Faculty of Business and Economics, TUD Dresden University of Technology, 01062 Dresden, Germany
Thomas B. Berger: Department of Business and Engineering, Faculty of Engineering, Baden-Wuerttemberg Cooperative State University (DHBW Stutgart), Lerchenstr. 1, 70174 Stuttgart, Germany

Risks, 2024, vol. 12, issue 12, 1-15

Abstract: We argue for an integrated, decision-oriented enterprise risk management (ERM) system focused on value drivers rather than risk minimization and using quantitative risk aggregation based on the best available information. Our holistic view on ERM includes cultural, organizational, and technical aspects, presenting seven areas for more effective risk governance and resilience grounded in a robust enterprise framework. Our analysis, supported by a structured literature review, covers these seven key areas for ERM development. Our review shows that risk aggregation, quantification, and decision-making support are only covered by a few publications. The paper offers insights on linking risk management with strategic decision-making using risk aggregation techniques (Monte Carlo simulation).

Keywords: enterprise risk management; risk governance; risk aggregation; value-based management; corporate planning; resilience (search for similar items in EconPapers)
JEL-codes: C G0 G1 G2 G3 K2 M2 M4 (search for similar items in EconPapers)
Date: 2024
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