Approaches to risk management
98
By identifying the key activities that deliver the selected core process, the club is
able to identify the risks that could impact both these activities and the core process.
Targets can then be set for increased
attendance at future games, and responsibility
for the success of this core process has been allocated to the commercial director of
the club. A consideration of the opportunities for increasing attendance at games can
also be included in this broader approach.
Definitions of eRM
Table 8.2 presents a number of suggested definitions of enterprise risk management.
There are three components that are required in a comprehensive definition of the
ERM process. These are: 1) the description of the process
that underpins enterprise
risk management; 2) identification of the outputs of that process; and 3) the impact
(or benefit) that arises from those outputs.
Many of the definitions concentrate on the process by describing the activities
that make up the ERM approach. This
is a good starting point, but the outputs from
that process are more important than the process itself. Some of the definitions
do include reference to the outputs from the process, such as being able to manage
TAbLE
8.2
Definitions of
enterprise risk management
Organization
Definition of enterprise risk management
RIMS
Enterprise risk management is a strategic business discipline
that supports the achievement of an organization’s objectives by
addressing the full spectrum of its risks and managing
the combined impact of those risks
as an interrelated risk
portfolio.
COSO
Enterprise risk management is a process, effected by an
entity’s board of directors, management and other personnel,
applied in a strategy setting
and across the enterprise, designed
to identify potential events that may affect the entity, manage
risk to be within its risk appetite and to provide reasonable
assurance regarding the achievement of entity objectives.
IIA (Institute of
Internal Auditors)
A rigorous and co-ordinated
approach to assessing and
responding to all risks that affect the achievement of an
organization’s strategic and financial objectives.
HM Treasury
All the processes involved in identifying, assessing and judging
risks,
assigning ownership, taking actions to mitigate or
anticipate them and monitoring and reviewing progress.
