Throughout the past year, businesses have been operating in a dynamic environment marked by constant change driven by global instability and the outbreak of COVID-19 that has caused significant disruption to business operations.
Companies operating in Hong Kong have had to deal with increasing uncertainty. It is therefore important for organisations to become agile in identifying, assessing and managing emerging and disruptive risks. KPMG and The Hong Kong Institute of Chartered Secretaries (HKICS) conducted a survey in early 2020 of Hong Kong-based senior management to assess how well risk management has been embedded within businesses in Hong Kong.
As a result of increasing regulatory focus on environmental, social and governance (ESG) issues, including requirements to identify and address ESG-related risks, the survey reveals that more organisations have considered ESG-related risks in the development of business long-term strategy. The key themes emerging from the survey indicate that businesses need to ensure proper integration of ESG into ERM and business long term strategy and enhance the relevance and sustainability of the ERM exercise to unlock the true value of risk management instead of merely fulfilling regulatory requirements.
This report discusses five key imperatives to help companies develop and implement an effective enterprise-wide risk management framework. A robust framework provides companies with a disciplined business tool to align strategy, processes, people, technology and knowledge to effectively navigate through a complex and rapidly changing environment and, ultimately, remain competitive and successful.