Enterprise Risk Management

A book review.

Enterprise Risk Management

Today's Leading Research and Best Practices for Tomorrow's Executives

by John Fraser, Betty Simkins

published: 2010.01.07

ISBN: 9780470499085

genre: Business (Management)

reviewed:2015.05.31

This sprawling book covers the field of Enterprise Risk Management. It was hot in the decade following the Enron debacle and the catastrophic mismanagement of risk during the Great Financial Crisis in and around 2008. The book, published at the tail end of that decade, contains several extensive articles on the nature and implementation of Enterprise Risk Management as a process. It explains this in terms that an MBA would find quite familiar: that business risk is uncertainty in attaining objectives and that the objectives of any corporation are to maximize returns to investors.

Given that "investors" have been largely replaced by extractive speculators, and that executives are if anything even more self-serving and exploitative, I'm not sure that this captures a sustainable model, nor does it offer a significantly different outlook to the kind of thinking that got us into a decade of disaster. But I digress.

The fundamental idea presented is that the board and the corporation's various risk management structures cause the firm to identify its goals and then set up a set of activities in accordance with those goals. Because metrics are also established, one gets accurate reporting as a secondary benefit - secondary but critical, in a regulated world.

As with any book containing articles from many contributors, there is decent quality to be had here but not everything seems to be equally relatable or on-focus. The extensive page count - and this is one of two volumes - makes me think that the editors could have been a bit more aggressive in deciding what was in or out. I had the impression that some of the authors where present to represent their advisory firms as much as anything.

P.S. I happened to meet one of the editors (Fraser) a number of times over the course of a few years. This was at an association of management consultants that was imploding due to a combination of demographics and Canada's rapidly hollowing economy. I was very impressed with his knowledge and obvious leadership skill.