Page 539 - COSO Guidance

8 | COSO’s 2010 Report on ERM | Thought Leadership in ERM

Extent COSO ERM Framework Assists in Achieving Benefits
Extent COSO ERM Framework Assists in Achieving Benefits

Improving Deployment
of Capital

Seizing Opportunities
Identifying and Managing Multiple “Significant or
and Cross-enterprise Risks A Great Deal”

Reducing Operational “Not at All
Surprises and Losses or Minimal”
Enhancing Risk “Moderate”
Response Decisions
Aligning Risk Appetite
and Strategy

0% 10% 20% 30% 40% 50%
When asked specifically about the application techniques neutral to positive (excluding those who were not familiar with
found in Volume 2 of the COSO ERM Framework, a majority of Volume 2), but there were strong indications that there was a
all respondents (56.6%) and public company respondents (55.6 need for more templates and examples and more up-to-date
percent) indicated that they were not familiar with Volume 2. ERM implementation examples. See table below:
Responses regarding the usefulness of Volume 2 were mostly

Percentages
Perceptions about Volume 2 “not at All “Moderate” “Significant or “not Familiar”
of COSO’s ERM Framework or Minimal” A Great Deal”

Volume contains useful templates and tools 8.1% 16.9% 18.4% 56.6%
need for more templates and examples 8.7% 10.5% 24.4% 56.4%
need for more up-to-date examples 6.3% 9.3% 28.0% 56.4%

Finally, at the conclusion of the survey, respondents were practical, actionable ideas versus theoretical guidance,
given the opportunity to give feedback on the top 3-5 specifically indicating that comprehensive examples and
most important actions COSO could take to improve the case studies, road maps for implementation, and other tools
effectiveness of the framework and related guidance, and would be useful. The next most common theme was that of
we received 119 comments and suggestions. We attempted simplification which was expressed in 20 responses. There
to group these comments according to various themes. The were also a number of comments regarding industry specific
most prevalent theme, expressed in 43 separate responses, guidance (10) and additional guidance on developing a risk
was that more practical guidance with either case studies appetite (10), as well as some calls for COSO to provide
or examples was needed. Respondents asked for more training and continuing education (8).

Summary Observations

Overall, the results of the survey indicate that the state to provide the underlying basis or foundation for that
of ERM in most organizations is still relatively immature discussion. There appears to be room for improvement in
and underdeveloped, with most respondents indicating underlying processes and procedures to strengthen an
dissatisfaction with current risk oversight processes. organization’s identification, assessment, and reporting
While a majority indicates that management and their of key risk exposures arising across all aspects of the
board of directors are discussing the organization’s top risk enterprise. Results do not significantly differ if only
exposures, there appears to be a lack of formal process or considering responses from public companies.
structure, including the presentation of key risk indicators,

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