Enterprise Risk Management: From Incentives to Controls
Enterprise risk management is a complex yet critical issue that all companies must deal with as they head into the twenty-first century. It empowers you to balance risks with rewards as well as people with processes. But to master the numerous aspects of enterprise risk management, you must intergrate risk management into the culture and operations of the business. No one knows this better than risk management expert James Lam. In Enterprise Risk Management: From Incentives to Controls, Lam distills twenty years worth of experience in this field to give you a clear understanding of both the art and science of enterprise risk management.Organized into four comprehensive sections, Enterprise Risk Management offers in-depth insights, practical advice, and real-world case studies that explore every aspect of this important field. Section I: "Risk Management in Context" provides an introduction and foundation for the rest of the book. You’ll learn why a company should strive for balance between risk and return, and discover some of the basic reasons why risk management is such an important issue in business today. You’ll also learn seven essential risk management lessons through discussions of some of the major financial disasters of years past. With this knowledge in hand, you’ll be introduced to some of the key concepts, processes, and tools underlying risk management.In Section II: "The Enterprise Risk Management Framework," you’ll receive an executive education on the business rationale for integrating risk management processes, and discover the seven building blocks for developing an enterprise risk management program. You’ll also discover how the role of Chief Risk Officer has changed in today’s firm.Section III: "Risk Management Applications" discusses the applications of risk management in two dimensions–functions and industries. You’ll become familiar with the functional requirements for credit, market, and operational risks, as well as learn how risk management has evolved from a control function to a function that enables performance optimization. Industry segments including financial institutions, energy firms, asset management firms, and nonfinancial corporations are also explored with an eye toward key business trends and risk management requirements in these sectors.Section IV: "A Look to the Future" rounds out this comprehensive discussion of enterprise risk management by examining emerging topics in risk management with respect to people and technology. A forward-looking story reveals how best-practice risk management might look in the year 2010.Failure to properly manage risk continues to plague corporate America–from Enron to Long-Term Capital Management. Don’t let it hurt your organization. Pick up Enterprise Risk Management and learn how to meet the enterprise-wide risk management challenge head on–and succeed.