ABSTRACT
This chapter explores the influence of risk management value creation objectives on planning and control systems using survey data from a broad international sample of listed, private and non-profit entities. It extends prior large-sample enterprise-wide risk management (ERM) studies by examining the performance implications of risk-focused planning and control practices and risk management objectives using survey-based and publicly-reported proxies for enterprise risk-taking and value. The chapter examines how differences in risk management value creation objectives affect the use or performance implications of risk-focused planning and control practices. It also examines the incorporation of risk considerations into four major components of planning and control systems: accountability and incentives, risk assessment, planning and budgeting, and performance measurement and reporting. The chapter investigates the extent to which the respondents' planning and control systems take into consideration both the potential cost-reduction benefits of eliminating, mitigating or sharing downside risks and the potential upside benefits of improved risk management.
