The Scope of Risk Management
We use many different terms to describe common risk management concepts. For example risk, threat, hazard and in insurance peril are all used interchangeably but this often causes significant confusion.
To manage this some countries and organizations have attempted to develop standards for the purpose of defining a common risk management language. Examples of such standards include the Australian/New Zealand Standard (AS/NZS 4360:1995). Other countries such as the UK, Canada and South Africa have also developed similar standards. Some leading risk management organizations have also developed standards. This includes AIRMIC, ALARM, IRM, and the International Standardization Organization (ISO).
It is worth noting that often people identify risk in a negative light, equating it with threat to some goal or objective. However business is built upon risk and without it there would be no possibility to make profit - which is commonly recognised as a reward for taking a risk.
Enterprise risk management is the recognition that it is often best to approaching the management of risk from an integrative stand point. Business risk comes in many forms and these forms are often changing. For example legislation evolves, competition develops and technologies are made redundant.
However a biannual survey conducted by AON indicates that the following are currently the top risks concerning top managers in 100 of Europe's top companies;