The pandemic has prepared organizations and business owners for the worst. Many businesses have suffered a severe blow in the past year. To look at the brighter side, many business owners have figured out how to rationally and effectively deal with adverse situations. Enterprises are aware of the probable challenges and are trying to handle them efficiently. One of the means that has become widely popular is establishing risk management committees. They comprise several functional leaders that regularly meet and assess, analyze, and discuss risk-oriented decisions. In their article, Enterprise Risk Management Initiative shares their insights on risk management committees and how they prove to be an excellent tool for efficient business processes.
Creating a Risk Committee
Matthew Dunn, Director of Finance and ERM leader at ConAgra talks about the roles and responsibilities of a risk committee in a recent interview with Don Pagach, a director at NC State University. Dunn asserts that the ERM risk committee comprises a cross-functional team with members from different professional spheres. Their team consists of C-suite executives like the CFO and CIO, a supply chain officer, and a few other professionals that assess risks and take actions based on the analysis.
Understanding the Work Structure
Dunn states that the committee monitors the potential risks in finance and insurance or other fields that may significantly impact the business. In a situation where the organization comes across a potential threat, they work on the report and present it to the audit and law committee and the board of directors. This entire session occurs twice a year and might be more frequent if required. The audit and finance committee would then analyze the report made by the ERM committee. The audit and finance committee also holds meetings with the ERM committee at least once a year to avoid risks and accentuate smooth business operation.
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