Corporate Risk Management

Corporate Risk Management 

Corporate Risk Management Components and Our Principles

Our Corporate Risk Management consists of five interrelated components. Components are listed as follows;

 

Governance and Culture

• Strategy and Goal Setting

• Performance

• Review and Correction

• Information, Communication and Reporting

 

Governance and Culture

 

Governance and culture form the basis of other elements of corporate risk management. Governance in general; It refers to the distribution of roles, authorities and responsibilities among stakeholders, board of directors and management. Governance determines the style of the organization and establishes oversight responsibilities.

Culture is a way of understanding the attitude, behavior and risk that influence management and staff decisions and reflects the organization's vision, mission, and core values.

 

Strategy and Goal Setting

In the process of creating strategies, corporate risk management acts together with the determined strategies and goals. Business goals form the basis for identifying, evaluating and responding to risks.

 

Business objectives enable the implementation of the strategy and shape the daily operations and priorities of the organization. There are four principles under this element:

1. Analyzing the Business Environment

2. Defining Risk Appetite

3. Evaluating Alternative Strategies

4. Setting Business Goals.

 

Performance

Risks that may affect achieving the strategy and business goals should be identified and evaluated. Risks should be prioritized according to the risk appetite.

There are five principles for this element:

1. Risks are defined.

2. Evaluating the severity of the risks.

3. Prioritizing the risks.

4. Applying the risk responses.

5. Developing portfolio perspective.

 

Review and Correction

In the light of significant changes, the organization reviews how the performance results in accordance with the goals, whether the corporate governance practices work well, whether they add value to the organization, whether they continue to add value, and whether there are any issues that need to be corrected. There are three principles under this element:

1. Evaluating Significant Changes

2. Reviewing Risks and Performance

3. Monitoring Improvements in Corporate Risk Management.

Tracing

The monitoring activity provides assurance that appropriate controls are in place, that the CRM stages are correctly positioned and followed (Griffi ths Phil, 2005) and that the activities carried out are in line with risk attitude strategies (Matyjewicz & D'arcangelo, 2004). The documents that guide this process and form the basis for the desired work can be listed as management performance results, board and risk committee reports, audit committee meeting minutes and report, control reports, risk assessments, action plan and internal audit report (Buckley, 2005).

Bibliography Notes: (COSO, 2017; Burca, 2017)