Question

Can a company like Apple Inc. use the Enterprise Risk Management technique as a way to help the company achieve its critical success factors of increase revenue, increase shareholder value, brand loyalty, product availability, and extensive research and development?

Answer 1

ERM is broadly about managing the risks that could be a potential threat to meet the stated objectives and strategies. ERM provides a framework for risk management, which involves identifying risks, assessing their likelihood and magnitude, developing strategies, and continuous monitoring. By addressing their potential risks, the organizations seek to pursue their stated objectives and create value for all stakeholders -owners, customers, employees, regulators, etc.

Considering its effectiveness, regulators in many countries have made it mandatory for listed companies to implement ERM in one or other forms. Companies are even required to disclose the ERM framework in their annual reports.

So, ERM can be a very useful technique that can help companies in achieving their objectives and strategies.