The report, authored by Russ Banham, highlights the enormous benefits businesses realize with a strategic advantage can be found in industries with a successful enterprise risk management (ERM) program. Companies can benefit immensely by using software to integrate their compliance and governance activities with ERM. Governance, Risk, and Compliance (GRC) software is currently being used by companies to aid them in their ERM processes. The five different types of enterprise risk include financial, strategic, hazard, human capital, and operational. GRC is used to analyze all the risks mentioned above and to determine how they are intertwined over the entire business. It is compared to a diagnostic tool used by mechanics to analyze vehicle malfunctions.
Board members are increasingly being asked to perform a more rigorous role in ERM. Not only do stakeholders expect boards to demonstrate a robust ERM program, rating agencies bring even more pressure to publicly-held companies to perform successfully with their risk management.
Even though GRC software has helped companies with their ERM program, it is important to remember that no two companies are alike. GRC must be structured around each unique situation and a common risk language must be implemented for everyone to understand. The goal is not to stop taking risks, but rather to use risks to make growth breakthroughs