The emerging, seemingly popular notion that enterprise risk management may not be meeting expectations and may be on the way out is much contrived and more than a bit overblown. In fact, while ERM may be at a crossroad of sorts, it offers organizations greater and more significant opportunities to make a difference.
To wit, Standard and Poor's has just announced it will begin applying ERM rating criteria to its credit rating for nonfinancial entities. This says loud and clear that the rating agency sees value in assessing ERM capabilities in all rated companies.
Admittedly it is not, as the age-old question from management was posed, that firms haven't been managing their risks. See the many tomes on risk management–most especially "Against the Gods: the Remarkable Story of Risk," by economic consultant Peter Bernstein–and you'll have to agree that entities have always "managed risk." It has merely been a question of effectiveness and remains so.
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