Enterprise risk management: Review, Critique and Research Directions

Many of the articles describe what the process should look like and how it should function, but there are few that provide details of how to get to that step. The paper addresses two questions: “What is ERM?” , “How can management research inform ERM theory and practice?” The measurement of risk presents a variety of research opportunities for management scholars, including (1) development of appropriate risk measures for ERM, (2) understanding the connections between managerial assessments of risk and objective measures of risks, (3) interpersonal and interorganizational variation in risk assessments, and (4) difference between individual and group effects on risk measurement. This paper reviewed the academic and practitioner literatures on risk and ERM to develop suggestions on where and how management scholars can contribute to ERM research. Practitioners need to understand how different individuals and groups within organization define risk, potential biases in risk assessment, and challenges in implementing risk management initiatives.