Twelve Things I've Learned About Enterprise-Wide Risk Management of Non-Financial Firms
16 December 2002
By Louis Guth
Much has been written about enterprise-wide risk management, but due to the difficulty of the process, there are still very few answers regarding the practical translation of the concept to non-financial firms. In this paper, NERA Special Consultant Louis Guth outlines twelve points that provide a framework for enterprise-wide risk management. This framework is founded in principles of financial economics, and serves as a guide for answering such fundamental questions as, What do we mean by enterprise-wide risk management? and What is the role of management of risk within the non-financial firm?
Mr. Guth's observations include an explanation of the types of risk firms must manage and why it is important to manage that risk. He then provides a summary of the critical issues in risk management, and provides a starting point for firms to identify their risk management opportunities.
