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The document discusses two leading risk management frameworks: ISO 31000 and COSO Enterprise Risk Management (ERM). ISO 31000 provides a structured approach to identifying, analyzing, and treating risks, while COSO ERM integrates risk management into overall organizational strategy. Both frameworks emphasize the importance of understanding risks, regular reviews, and effective communication within organizations, with the choice of framework depending on specific organizational needs.

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8 views2 pages

Documentjdis

The document discusses two leading risk management frameworks: ISO 31000 and COSO Enterprise Risk Management (ERM). ISO 31000 provides a structured approach to identifying, analyzing, and treating risks, while COSO ERM integrates risk management into overall organizational strategy. Both frameworks emphasize the importance of understanding risks, regular reviews, and effective communication within organizations, with the choice of framework depending on specific organizational needs.

Uploaded by

julliennelegara
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Risk Management Frameworks

A framework is used as a guide in formulating a company's


risk management process

The two leading risk management frameworks today;

-ISO 31000-Risk Management

-COSO Enterprise Risk Management

ISO 31000 - Risk Management

- 1S0 31000 follows a structured approach toward the systematic


application of management policies and procedures to the activities
of communication, consulting, establishing the context, and
identifying, analyzing, evaluating, treating, monitoring, and
reviewing risk.
The steps under ISO 31000 are summarized below:
 Identification of all risks that could prevent the company
from achieving its business objectives.
 Analysis of risk including an understanding of its causes and
effects.
 Determination whether identified risks are tolerable or not.
 Treatment of significant risks by way of mitigating
procedures and thereby reducing the impact and/or the
likelihood of the risks.
 Monitoring risk management strategy and implementation to
determine gaps that should be addressed.
 Communication of information pertaining to the risk
management process of the company.

COSO Enterprise Risk Management (ERM) - Provides a


comprehensive approach to risk management across the
organization that helps organizations integrate risk management
into their overall strategy, so they can achieve their objectives
while handling potential risks effectively.
(jo butngi og venn diagram ari kanang sa ISO 31000 og
COSO ERM)
----------------------------------------------------------------------------
SIMILARITIES
-Both frameworks aim to help organizations manage risks
effectively.
- They both emphasize the importance of identifying and
understanding risks.
- Each framework stresses the need to incorporate risk
management into the organization’s overall processes.
-Both focus on regularly reviewing and improving the risk
management process.
- They both highlight the importance of sharing risk information
within the organization.
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Conclusion: Both frameworks offer valuable approaches to
managing risks.
both COSO ERM and ISO 31000 aim to manage risks effectively,
emphasize identifying and understanding risks, integrate risk
management into overall processes, encourage regular
improvement, and support effective communication within the
organization.Also with COSO focusing on integrating risk
management into overall strategy and ISO 31000 offering a flexible,
principles-based approach.

Choosing the right framework depends on organizational needs and


context.

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