What is Missing from the RMIS Design? Why Enterprise Risk Management Is not Working
- Topics:
- Enterprise Risk Management
- Tags:
- Business Operations,
- Business Security,
- Enterprise Risk Management,
- Finance,
- Financial Accounting,
- Financing,
- Insurance,
- Investment
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Overview: Many risk managers have attempted to take enterprise risk management (ERM) from a slick consulting pitch to a practical management system. But while ERM has helped many of these professionals improve the strategic structure of their risk financing programs, few have fully achieved their ambitions. One obstacle is the risk management information system (RMIS) built without an enterprise wide orientation toward risk data. For ERM programs to fulfill their potential, the RMIS must focus on the risk financing needs and processes of the entire company-i.e., reporting based on its specific financial and operational dynamics. It cannot just tally the insurance companies' claims and losses, as it does now. The system should incorporate occurrence descriptions and retained loss costs. It should support a range of risk financing methods and the financial analysis and reporting needs of the risk manager. Current professional have defined that ERM should achieve proper allocation of risk capital across three major risk categories-financial, credit and operational risk.
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Format: HTML | Date: Jan 2003 | Pages: 1
