ABSTRACT
This chapter focuses on the meaning of the risk and enterprise risk concepts. It discusses how to measure, describes risk and enterprise risk. The chapter addresses a common risk management issue. Risk of an enterprise where the consequences are related to the principal objectives or overall performance judged important for the organization. The latter method ensures that the experts’ and analysts’ judgements are reported and communicated, whereas the former method restricts its results to a representation of documented knowledge. The Board of an enterprise has challenged the enterprise risk manager to present an overview of the risks that the enterprise face. The enterprise risk manager considers first to use an extended risk matrix. The extended risk matrix provides some information about risks. The matrix does not provide clear answers as to what are the biggest risks. When presenting the extended risk matrix to the Board, it is observed that the matrix is rather static.
