Survey Highlights Success Factors for Agencies Implementing Enterprise Risk Management

In the world of risk management and business resilience, the importance of enterprise risk management (ERM) cannot be overstated. A recent survey conducted by the Association for Federal Enterprise Risk Management (AFERM) and Guidehouse shed light on the success factors of agencies that have effectively incorporated ERM into their operations.

The survey revealed that agencies where ERM is integrated into the performance plans of Senior Executive Service members and where the ERM program lead reports directly to the agency head or deputy are among the highest performing. This highlights the importance of taking proactive measures to prioritize ERM within an organization.

One key finding of the survey was the increase in resources dedicated to ERM, with 38% of respondents indicating that at least 11 people work on risk management on a full-time basis. This demonstrates a growing recognition of the value of ERM in managing risks effectively.

Another significant trend identified in the survey is the focus on developing risk appetite statements. More than 90% of respondents reported updating their risk appetite statement within the last three years, indicating a shift towards a more mature approach to risk management.

Despite the progress made in ERM implementation, the survey also highlighted areas where challenges persist. One such challenge is the gap between the perception of risk and the actions taken by management to address those risks. This disconnect presents an opportunity for organizations to reassess their risk management strategies and ensure they align with their risk appetite.

Overall, the survey results underscore the importance of continued investment in ERM and the need for organizations to adapt their risk management approaches to their specific needs and resources. By prioritizing ERM and integrating it into all aspects of their operations, agencies can enhance their resilience and ability to navigate uncertainties effectively.

As agencies continue to navigate evolving risks and challenges, the insights from the AFERM/Guidehouse survey serve as a valuable resource for enhancing risk management practices and promoting business resilience in an increasingly complex environment.