IRM M1U1.4 Different appoaches to ERM

Question 1

What question all risk management processes are trying to answer? (Hillson, 2016:5)

Answer 1

All risk management processes, are trying to answer the same question – considering the risks being faced, can the objectives be achieved?

Question 2

The four-step model was developed by Satarla, pulls together the most important aspects from all of the main international standards.

Answer 2

(SATARLA 2022 - reproduced with permission)

Figure 1.4.1 - Risk Management - four easy steps

Define context and objectives - Understand your internal and external context and how it is changing. Within this context and scope, articulate your objectives.

Assess the risks - Identify both the potential threats and opportunities (risks), understand them using the most appropriate techniques, and ask yourself: “so what? Do we need to do anything about these risks?”.

Manage the risks - Where possible take charge of the risks, or aspects of them through implementing controls. Note – a control is an act, object or system that modifies a risk. If the activity does not actually change the risk, it is not a control.

Monitor, Review and Report -Tell people what you are doing and what they need to know (and perhaps do) regarding the status of the risks and how effectively they are being managed.