In Chapter 6, LEGO group had, initially, difficulties in implementing an effective ERM strategy because they focused on operational risks at the unit level and did not consider the same at the enterpr
2 substantive replies for the below 2 posts:
Post 1
Hi all,
The global ERM strategy can handle the global level risks and tries to resolve the company's global risks with this ERM strategy. But in the alignment of global to local and business units, organizations are required to develop the new integrated framework or any preexisting integrated frameworks for alignment, organizations use the suitable framework. One of the frameworks is Organizations of the Treadway Commission COSO framework. It is an integrated framework and it’s introduced in 1992. This framework is helpful for the alignment of global ERM strategy into local and business units.
The important component of this framework is the internal environment. Organizations need to identify the local internal environment and try to identify local business risks. After analysis of the internal environment to resolve risks for the objectives.
In this object setting process based on the type of organizational business, properties set the objectives and resolve the risks with effective objects. Next, identify the events in the event identification step and conduct the risk assessments and identify the all local risks of organizational business activities and events. Next to develop the risk response type and in risk response include the things that are reduced, accept, avoid, and transfer. Control the activities risks with information and good communication. Establish the communication with monitoring the organizational business operations and reduce the risks with the COSO framework (Nityashree Yadunath, 2018).
References
Nityashree Yadunath. (2018). Enterprise Risk Management Framework: 8 Core Components. Available
Post 2
Top of Form
Hi all,
In organizations many risks in business operations. By conversion of risks into opportunities implement the enterprise risk management strategy. In this ERM strategy implementation globally first need to identify the company global operations and identify the possible potential risks in global business operations. The alignment of global ERM strategy to local and business units in this process the organization need to understand the local people requirements and identify the local business operations risks. The global risks and local business risks are different. Based on location the risks are changed because the customer requirements are changed. In this alignment conducted the self-assessment and internal audits in organizations and identify the possible potential risks in local business operations. Gathered the information about local compliances and need to identify the local compliances risks. By analysis of global and local risks align the implemented ERM strategy into local and business units based on type of business and customer requirements.
In alignment of global ERM into local and business units by perform the analysis on local and global business risks. The local risks are changed based on place, so organization always update the local risks management and risk plan in ERM strategy. By using integrated framework is COSO ERM integrated framework and aligned the global ERM strategy into local and business units. The full form of COSO is Committee of Sponsoring Organizations of the Treadway Commission ERM framework. This framework has 5 components there are governance and culture, other is strategy and objectives, performance, review and revision and final component is information, communication and reporting. By follow of this framework aligned the global ERM strategy into local and business units ( Protiviti , 2020).
References
Protiviti . (2020). Five Components of the COSO Framework You Need to Know. Available at:https://info.knowledgeleader.com/bid/161685/what-are-the-five-components-of-the-coso-framework.
