Journal of Management Research
Volume 17, Number 4 (October–December 2017)
ISSN: 0972-5814 Online ISSN: 0974-455X
The Determinants of Firm Value From Enterprise Risk Management Perspective A Conceptual Model
Anju K.J. and Uma V.R.
| Abstract |
Many studies have proved that uncertainty bounds today’s economy and every organization needs a structured process for effective risk management to sustain with a competitive edge. Numerous corporate governance regulations like SOX Act 2002, COSO Enterprise Risk Management Framework 2004, Companies Act 2013, Clause 49 of SEBI made the existence of a risk management committee mandatory. Unlike traditional risk management, Enterprise Risk Management (ERM) is found to be proactive, continuous, value-based, focused and process driven activity. Earlier studies have observed that the integrated approach of ERM guides management to diagnose risk and evaluate effective strategies for managing the organization’s exposure with its risk requirement. This paper intends to propose a conceptual model for identifying the determinants of firm value by examining the correlation between the existence of Risk Management Committee or Chief Risk Officer, Audit Committee, and Firm Value on ERM implementation. The results of this proposed study could be of primary importance in analysing whether the companies that adopt ERM has increased their firm value.
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