Modern risk management through the lens of the ethical organizational culture

Abstract

Most recent efforts to create guidance for modern risk management practices emphasize the importance of connecting risk management policy and practice with an organization ' s culture and values. However, identifying or establishing that connection is not widely discussed or understood. What does it mean to state that risk management is an expression of an organization ' s values? This article discusses the basis for identifying the connection between organizational values through the lens of the Ethical Organizational Culture and attempts to draw out linkages with current risk management thinking on the subject. The establishment of a basis of identifying organizational values and their link to risk management policy and practice is illustrated through a case analysis of the Veritas Institute ' s Self-Assessment and Improvement methodology. Risk Management (2013) 15, 32 -49.Keywords: modern risk management ; the ethical organizational culture ; risk management and culture ; risk management ; organizational values While all organizations manage risk to some degree, this International Standard establishes a number of principles that need to be satisfi ed to make risk management effective. This International Standard recommends that organizations develop, implement and continuously improve a framework whose purpose is to integrate the process for managing risk into the organization ' s overall governance, strategy and planning, management, reporting processes, policies, values and culture (ISO, ISO 31000, 2009). 33

Sustainability Risk Management (SRM): An Extension of Enterprise Risk Management (ERM) Concept

“…The result indicated that the industrial sectors exposed more to the environmental risk and were tend to receive greater pressures from the stakeholders as mentioned by González-Benito and González-Benito (2006 Jondle et al (2013) the integration of ethical values in risk management would be an advantage to the company to strategically protect the shareholder value in the long term.…”

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“…Lastly, there was also an association between long-term shareholders value and type of sectors at the 10 per cent significance level (p = 0.086). According to Jondle et al (2013) the integration of ethical values in risk management would be an advantage to the company to strategically protect the shareholder value in the long term.…”

Risk Culture: What It Is and How It Affects an Insurer's Risk Management

“…Vice versa, risk managers should be aware that the risk management framework is influenced by the basic assumptions of those writing the rules (cf. Jondle et al., ). The arrows, as indicated in Figure , point in both directions.…”

“…What has not received much attention yet is the interaction between a control system such as risk management and the social context. One exception is the study by Jondle et al (2013) that links cultural values to risk management using the ethical organizational culture framework. They argue that ISO 31000 itself is based on implicit values such as a respect for the scientific method, respect for the past, personal, and corporate responsibility for actions and consequences or a long-term time orientation (p. 42).…”