An Examination of Enterprise Risk Management (ERM) Practices among the Government-Linked Companies (GLCs) in Malaysia

Abstract

Enterprise Risk Management (ERM) is a new concept of managing risks holistically and in Malaysia, such a concept is still relatively new among Malaysian companies. On a positive note however, the ERM concept appear to be receiving much attention over the recent years from various businesses and industries in Malaysia. This particular study aims to determine the level of ERM adoption among the Government-Linked Companies (GLCs) and to examine the influence of Chief Risk Officers (CROs) and Board of Directors (BODSs) on the ERM implementation itself. Findings of the study showed that the more established GLCs were more receptive to the adoption of ERM as compared to the less established ones. Also, companies that adopt ERM were found to have appointed the Chief Risk Officers (CROs). In addition, the quality of Board of Directors (BODSs) was also found to play a significant role in respect of ERM implementation.

Enterprise Risk Management and the Performance of Local Contractors in Singapore

“…The cost to the entity for implementing and maintaining an ERM system is grossly out-weighed by the results and knowledge gained in evaluating, assessing, and overseeing risks to insure the achievement of strategic objectives over the short-term and long-term life of the organization (Burnaby et al, 2009). The fact that the more established companies were more receptive to the adoption of ERM (Yazid et al, 2011) lends additional support to the view that ERM will improve the firm's performance.…”

“…The latter has been extensively discussed for more than a decade (Lam 2000;Meulbroek, 2002;Nocco et al, 2006;Makomaski 2008;Gordon et al, 2009;Yazid et al, 2011). ERM was first introduced in and quickly accepted by the financial sector.…”

A Contingency‐Based Framework for Managing Enterprise Risk

“…According to Chenhall () and Abdel‐Kader and Luther (), larger corporations tend to have enough resources to adopt more advanced practices. Pagach and Warr () and Yazid, Hussin, and Daud () also mention the importance of having enough resources to support ERM programs. Moreover, as a corporation becomes larger, the need for its managers to handle great quantities of data increases (Child & Mansfield, ; Yazid et al., ).…”

“…Pagach and Warr () and Yazid, Hussin, and Daud () also mention the importance of having enough resources to support ERM programs. Moreover, as a corporation becomes larger, the need for its managers to handle great quantities of data increases (Child & Mansfield, ; Yazid et al., ). Sophisticated ERM methods can help organizational leaders do a more thorough analysis of any available information and eventually help them better capture and mitigate risks (Subramanium et al., ).…”

Risk Management and Enterprise Risk Management

“…Also, the fact that the more established firms are more receptive to ERM adoption (Yazid et al 2011) (Acharyya 2007;Gates 2006;Lam 2003;Nocco and Stulz 2006;Perrin 2006;; 9. Better resource allocation (Liebenberg and Hoyt 2003;Liu et al 2011;Meulbroek 2002); 10.…”