Enterprise Risk Management in Terms of Organizational Culture and Its Leadership and Strategic Management

Abstract

Enterprise risk management is not a kind of one time event. ERM may be considered as a management philosophy, mentality, and as a holistic system. As a leading holistic management system, Enterprise Risk Management will both affect and shape the corporate culture and style of leadership and corporate strategy. Strategy is among other things about risk attitude, risk taking approach, risk culture, and risk appetite. For these reasons, to develop strategy and achieve it, managers have to implement enterprise risk management as a shaped/individualized style. Human factor has a dual role in business, and actually in life-as risk source and risk manager. Humans both create and manage risks. Based on this reality, enterprise risk management takes into consideration organizational behavior, as well as, physiology and sociology.