Is your organization versed in risk management? Risk management is a process that needs to be undertaken thoughtfully and deliberately. First, organizations need to understand that there is a distinct difference between risk management and enterprise risk management (ERM). While risk management may extend only within the organization’s comfort zone, ERM requires that an organization take a high-level view of its place in the nonprofit landscape.
ERM is a more broad-based view of the organization’s ability to manage risk and, if assessed properly, should help the organization achieve its overall mission.
The transition into ERM can cause some growing pains as since to be effective, this often requires a change in the organizational culture. However, ERM can make an organization more agile and allow top-level management to drill down into specific aspects of its exposure to risk, thereby lessening the risk.
More information about ERM and a list of key questions an organization should ask when evaluating its ERM can be found here.