ERM Frameworks Flashcards
ERM - Integrated Framework
To assist organizations in developing a comprehensive response to risk management
Risk
The probability that some event will happen that can affect the achievement of goals and objectives
Value
Stock price up and/or pay dividends - Develop Value, Willing to face risk
Value (CPER)
Creation, Preservation, Erosion, and Realization. Value is defined by the type of entity
Value Creations
Benefits have to exceed cost of resources. Need to generate a profit.
Value Erosion
Do not want value to go down. The cost is greater than the benefit.
- Faulty Strategy
Value Realization
Dividends/SP > cost “capital gain” Value is received by stakeholders. Brand is recognized, leadership, customer satisfaction
Mission, Vision, and Core Values
What an entity strives to be and how it wants to conduct business..Successful and ethically
Mission
Objective, core purpose
Vision
Strategy
Vision
Strategy
Core Values
“How” to achieve goals - ethics, culture, core values
CCPIS
To manage risk and create value
Culture, Capabilities, Practices, Integration with Strategy
ERM
The culture, capabilities, and practices, integrated with strategy setting and performance, that organizations rely on to MANAGE RISK in creating, preserving, and realizing value.
Culture
Core Values, collective thinking, shaping decisions
