CHAPTER 18 Blue Wood Chocolates


Partner, RSD Solutions Inc.


Partner, RSD Solutions Inc., and Associate Professor of Finance, Dalhousie University

This case highlights many issues around enterprise risk management (ERM). It concerns a company that has turned in a satisfactory performance in the past, although this has been a result, at least in part, of luck rather than design. There is a variety of risk and governance issues that can be discussed. They include prioritization of actions and implementation of an ERM framework when considering how to deal with a diversity of personalities and opinions.


Sally Holton, the newly appointed chief financial officer (CFO) of Blue Wood Chocolates, gazed from her office window at the sunny scene outside. Her mood was far from sunny, however, as she pondered what seemed like a mountain of urgent issues facing her. It seemed that there were no easy solutions to any of them.

Blue Wood Chocolates makes chocolate products at its plants in the Midwestern United States for sale domestically and internationally. The company has delivered a mixed financial performance over the past couple of years with volatility that management has not been able to explain, and that the board of directors and owners consider unsatisfactory. There has been an ongoing debate among board members as to whether the lackluster results are due to operations or the vagaries of the commodities markets.

When the long-serving ...

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