Enterprise risk management and firm performance: Role of the risk committee
Malik, Muhammad Farhan, Zaman, Mahbub, & Buckby, Sherrena (2020) Enterprise risk management and firm performance: Role of the risk committee. Journal of Contemporary Accounting and Economics, 16(1), Article number: 100178 1-22.
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ERM and Firm Performance. |
Description
In recent years, there have been increasing efforts in the corporate world to invest in risk management and governance processes. In this paper, we examine the impact of Enterprise Risk Management (ERM) on firm performance by examining whether firm performance is strengthened or weakened by the establishment of a board-level risk committee (BLRC), an important governance mechanism that oversees ERM processes. Based on 260 observations from FTSE350 listed firms in the UK during 2012–2015, we find the effectiveness of ERM significantly and positively affects firm performance. We also find strong BLRC governance complements this relationship and increases the firm performance effects of ERM. Our findings suggest the mere formation of a BLRC is not a panacea for ERM oversight; however, existence of a structurally strong BLRC is crucial for effective ERM governance.
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| ID Code: | 136141 | ||
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| Item Type: | Contribution to Journal (Journal Article) | ||
| Refereed: | Yes | ||
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| Measurements or Duration: | 22 pages | ||
| Keywords: | Enterprise risk management, Firm performance, Risk committee, Risk governance | ||
| DOI: | 10.1016/j.jcae.2019.100178 | ||
| ISSN: | 1815-5669 | ||
| Pure ID: | 42489513 | ||
| Divisions: | Past > QUT Faculties & Divisions > QUT Business School Current > Schools > School of Accountancy |
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| Funding Information: | We acknowledge the co-editor, Peter Clarkson, and the anonymous reviewer for their constructive and helpful comments. This paper has benefited from the helpful comments of John Nowland of Illinois State University and Peter Green of Queensland University of Technology. The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper. | ||
| Copyright Owner: | Consult author(s) regarding copyright matters | ||
| Copyright Statement: | This work is covered by copyright. Unless the document is being made available under a Creative Commons Licence, you must assume that re-use is limited to personal use and that permission from the copyright owner must be obtained for all other uses. If the document is available under a Creative Commons License (or other specified license) then refer to the Licence for details of permitted re-use. It is a condition of access that users recognise and abide by the legal requirements associated with these rights. If you believe that this work infringes copyright please provide details by email to [email protected] | ||
| Deposited On: | 23 Jan 2020 04:31 | ||
| Last Modified: | 21 Apr 2025 18:39 |
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