What is Enterprise Risk Management?
Every organization is faced with the challenge of a successful execution of its Strategic Plan. While based in optimism, sometimes things don’t exactly happen as envisioned. Unexpected events – e.g. changes in regulation, failed business ventures, economic distress, key stakeholder delivery failure, unplanned operational interruptions, etc. – have become a common occurrence in today’s interconnected business environment. Has your entity challenged the foundational assumptions of its business model, present and future? Is there alignment between the Board of Directors and Management regarding organizational risk appetite? Do your employees understand the acceptable amount of risk they are permitted to take when designing new products and services or faced with important decisions?
The ERM Initiative within the Poole School of Management at North Carolina State University, a leading authority on Enterprise Risk Management, describes ERM as a proactive “holistic, portfolio-view of the most significant risks to achievement of an entity’s most important business objectives.” Think of it as a top-down, “big picture” view of Risk – e.g. financial, operational (i.e. transactional, technology, third-party, cybersecurity, continuity), legal/compliance, reputational, both downside (negative) and upside (opportunity) – and its potential to derail (or enhance) organizational strategic directives. Understanding your Board’s risk appetite as it applies to long-term strategic direction provides clear boundaries (or tolerance levels) for risk-based decision making – a key to organizational success. The successful implementation of ERM can improve capital resource allocation decisions, increase operational efficiency, and enhance your credit union’s risk control efforts to support critical compliance, governance, and strategic initiatives.
Symphony can help your organization with its implementation of an integrated approach to the identification and evaluation of mission-critical risks, assessment of current risk management program elements against “leading practices” and regulatory requirements, construction of continuous in-depth ERM processes, and facilitation and alignment of your entity’s risk appetite and tolerances with its business model, strategic plans, and risk-taking culture. Whether your credit union is new to the ERM process or has an established framework in place, Symphony is here to assist with its risk management endeavors.
What You Can Expect
- ERM-credentialed, credit union-experienced resources;
- Expert-led training, process guidance, program audit/review, and discussion facilitation;
- Industry “leading practice” methodology designed to align with NCUA/FFIEC regulations;
- Establishment of an empowered culture fueled by risk-based decision-making; and
- “Do The Right Thing” mindset to protect the credit union’s most valuable assets – trust, brand and reputation, and your employees and members.