The value proposition for ERM goes up exponentially the more executives integrate their discussions of risks in the context of the strategy of the business.  Too often ERM programs fail to explicitly put risk in the context of what drives value for the business.  For ERM to be a significant strategic tool, risks need to be connected and considered from a strategic lens.

In this video, Mark Beasley, KPMG Professor and Director of the ERM Initiative and Håkan Jankensgard, engage in a discussion about why starting with a rich understanding of what is most strategically important to the business is the most critical first step in any ERM process.  Håkan and Mark highlight how ERM leaders often skip over that step and move directly into an exercise to identify risks, without first beginning with a rich understanding of what is most important to the organization’s success.

Mark and Håkan share thoughts about answers to these questions:

  1. Why is it important for ERM and Strategy to be integrated?
  2. Why do organizations struggle with this integration?
  3. How might organizations develop a strategic lens to provide a basis for considering risks?
  4. What are some examples of techniques or approaches organizations use to practically integrate risk and strategy thinking?
  5. What advice might you provide to help ERM leaders be better positioned to integrate ERM and Strategy?

They identify a number of practical steps organizations can take to integrate risk-thinking into their strategy planning and execution processes.

Håkan is an Associate Professor in Corporate Finance at Lund University, based in Lund, Sweden.  His research focuses on ERM and he is the author of books on ERM topics: Empowered Enterprise Risk Management:  Theory and Practice and Corporate Foreign Exchanges Risk Management

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ERM Enterprise Risk Management Initiative 2021-08-31