Enterprise Risk Management

Foreword

I am pleased to welcome this important collection of authoritative papers on enterprise risk management. This subject has, unfortunately, operated below the visibility screen of most CEOs for many years. In the financial institutions, where regulations require a risk management process, most bank CEOs viewed it as a compliance process, much like internal audit and internal controls. They did not view risk management as a strategic process nor one that demanded much of their time and attention. As a consequence, most businesses have limited ability to assess its risk from rapid growth, increased complexity in financing and securitization, and globalization. Company executives have not been the only ones failing to pay sufficient attention to the topic. Few MBA, accounting, or finance programs departments featured courses and training in enterprise risk management.

The events of 2007–2009 have made the gaps in knowledge, training, and attention to risk management abundantly clear, albeit in a highly costly and tragic manner. Businesses, business schools, regulators, and the public are now scrambling to catch up with the emerging field of enterprise risk management. This subject must become a priority for students to study, executives to practice, and regulators to verify. Fraser and Simkins have produced an impressive contribution to the field, one that I believe will help to educate many. I hope this book, beyond its educational and attention-directing mission, will ...