About ERM
The holistic approach that characterizers the present trend of risk management, referred to in some text as enterprise-wide risk management, enterprise risk management (ERM), strategic risk management, or integrated risk management, is aimed at dealing with uncertainty for the organisation.
The rationale behind this approach is that value is maximized when the decision-makers sets strategy and objectives to strike an optimal balance between growth and return goals, and the related risks, and efficiently and effectively allocate resources in pursuit of the entity's objectives. Barton et. Al started that the goal of this new approach is to create,protect, and enhance shareholder value by managing uncertainties that could influence the achievement of organisation objectives
Enterprise risk management is clearly distinguished from risk management and financial risk management in the RIMS executive report, 2009. While risk management is described as a board term for the business discipline that is concerned with the protection of the assets and profits of an organosation by either reducing the potential before it occurs, mitigating the impact of a loss if it occurs, and the execution of a swift recovery after a loss occurs; financial risk management is the term often used by non-financial institution to describe the mitigation process for their financial exposure; erm on the other hand, is said to represent a revolutionary change in the risk management discipline that broadens the scope of risk management behaviors.