A recent study published jointly by the Institute of Management Accountants (IMA®) and the Association of Chartered Certified Accountants (ACCA) posits that a challenge culture can be an effective way of ensuring that a sophisticated risk management system, such as enterprise risk management (ERM), evolves beyond a mere shallow compliance exercise. This article continues the conversation on approaches that help to ensure a risk challenge culture permeates throughout organizations. Real-world examples are given of how the IMA-ACCA study discusses system design and implementation approaches that are commonly considered to be part of the successful implementation of any strategic initiative but are framed in a risk challenge culture context. Using specific examples, this article extends the discussion of General Motor’s past ERM deficiencies and, in particular, its failure to correct its ignition-switch problem in a timely manner, including the significant financial and legal consequences.
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