In my last post, Gordon Burnes identified a formal enterprise risk management (ERM) program as one of the best ways for organizations to be prepared for the potentially massive U.S. regulatory overhaul to be unveiled by President Obama very soon.

That seems like a compelling reason; however, if you (or your colleagues) remain unconvinced of ERM’s value, BDO consulting partner Glenn Pomerantz and managing director Sydney Rose Leo, who have been presenting on ERM lately, identify several other motivations for implementing a formal ERM program.

They say that ERM enables a company to:

• Prevent highly likely and high-impact risks from happening at the company or reduce the impact of risk;

• Support the board of directors’ responsibilities;

• Bring the management team to consensus on key risks;

• Lower the costs of audits;

• Lower the costs of insurance;

• Improve bond ratings;

• Become good at managing risk so that the company can grow faster; and

• Gain a competitive advantage. ###