مدیریت ریسک سازمانی و عملکرد شرکت : دیدگاه اقتضایی
|کد مقاله||سال انتشار||مقاله انگلیسی||ترجمه فارسی||تعداد کلمات|
|725||2009||27 صفحه PDF||سفارش دهید||محاسبه نشده|
Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)
Journal : Journal of Accounting and Public Policy, Volume 28, Issue 4, July–August 2009, Pages 301–327
In recent years, a paradigm shift has occurred regarding the way organizations view risk management. Instead of looking at risk management from a silo-based perspective, the trend is to take a holistic view of risk management. This holistic approach toward managing an organization’s risk is commonly referred to as enterprise risk management (ERM). Indeed, there is growing support for the general argument that organizations will improve their performance by employing the ERM concept. The basic argument presented in this paper is that the relation between ERM and firm performance is contingent upon the appropriate match between ERM and the following five factors affecting a firm: environmental uncertainty, industry competition, firm size, firm complexity, and board of directors’ monitoring. Based on a sample of 112 US firms that disclose the implementation of their ERM activities within their 10Ks and 10Qs filed with the US Securities and Exchange Commission, empirical evidence confirms the above basic argument. The implication of these findings is that firms should consider the implementation of an ERM system in conjunction with contextual variables surrounding the firm.
Managing risk is a fundamental concern in today’s dynamic global environment. In recent years, however, a paradigm shift has occurred regarding the way to view risk management. Instead of looking at risk management from a silo-based perspective, the trend is to take a holistic view of risk management. This holistic approach toward managing an organization’s risk is commonly referred to as enterprise risk management (ERM). A general argument gaining momentum in the literature is that the implementation of an ERM system will improve firm performance (e.g., see Barton et al., 2002, Lam, 2003, Stulz, 1996, Stulz, 2003, COSO, 2004, Nocco and Stulz, 2006 and Hoyt and Liebenberg, 2009). The findings by Hoyt and Liebenberg (2009), for example, based on data from the insurance industry and using Tobin’s Q as the measure of performance, support this argument.1 The fact that many firms have adopted ERM (e.g., see Gates and Hexter, 2005) lends additional support to the view that ERM will improve firm performance. Nevertheless, empirical evidence confirming this relation between ERM and firm performance is quite limited and is not based on a robust measure of ERM. The primary objective of the study reported in this paper is to examine empirically the argument that ERM is related to firm performance. We argue that the ERM-firm performance relation is contingent upon the appropriate match between a firm’s ERM system and several key firm-specific factors. Based on the relevant literature, we identify five specific firm factors that are believed to have an impact on the ERM-firm performance relation. These factors are: (1) environmental uncertainty, (2) industry competition, (3) firm complexity, (4) firm size, and (5) board of directors’ monitoring. In pursuing the above objective, we also develop an ERM index. To our knowledge, we are the first to develop such an index. The analyses presented in this paper are based on an empirical study of 112 US firms that disclose their ERM activities in their 10K and/or 10Q reports for 2005 with the US Security and Exchange Commission (SEC). The findings from this study provide strong evidence that there is a positive relation between ERM and firm performance, but that this relation is contingent upon the appropriate match between a firm’s ERM system and the five factors noted above. These findings are robust to such concerns as the self-selection problem, the effectiveness of a newly constructed ERM Index, different measures for monitoring by the firm’s board of directors, and different measures of firm performance. The remainder of this paper will proceed as follows. In section two we develop the basic argument and research design underlying the empirical study discussed in this paper. The empirical study designed to test this argument is discussed in the third section of the paper. The fourth section of the paper presents the main results of the empirical study. The fifth section provides robustness checks for the main findings. The sixth section of the paper provides some concluding comments.
نتیجه گیری انگلیسی
Based on a sample of 112 firms disclosing the implementation of enterprise risk management (ERM) in their 2005 10K and/or 10Q reports, this paper investigates whether the relation between ERM and firm performance is contingent upon the proper match between ERM and five key contingency variables. The findings from our study confirm the argument that the ERM-firm performance relation is indeed contingent on the proper match between ERM and the following five variables: environmental uncertainty, industry competition, firm size, firm complexity, and monitoring by the board of directors. This finding is robust, even when we correct for the self-selection bias, choose different cutoffs for high performing firms, use an alternative measure for board monitoring, and consider an alternative timing for firm performance. The findings from the analyses suggest that our ERM Index (ERMI) is a reasonable (although not perfect) measure of the effectiveness of ERM. As with all empirical studies in the social sciences, there are limitations to our study. The most obvious limitations to this study are as follows. First, the study only covers data from 2005. Therefore, the findings are not generalized to other time periods. A second limitation of this study relates to that fact that we use one-year excess stock market returns to measure firm performance. Other measures of performance (e.g., Tobin’s Q or a five-year excess returns) could also be considered. A third limitation to this study is that a theoretical model describing which contingency variables should be considered in studies like this one does not exist. Thus, we selected contingency variables based on the way we interpret the extant literature. Of course, others could interpret the existing literature differently than we do and therefore argue for considering different variables. Given the above limitations, the findings from this study should be interpreted as preliminary, rather than definitive. This fact notwithstanding, we believe that the results of the study reported in this paper provide important insights into the relation between ERM and firm performance. In essence, these results show that the relation between a firm’s ERM and its performance is dependent on the proper match between a firm’s ERM and the contextual variables surrounding firms.