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We will publish new book: Modern Risk Management Perspectives and Concepts (part III)
Twenty (20) components of the 1st comparative RM standards for listed and unlisted companies
Next, not only we suggest to implement a RM form in Appendix for the above 20 elements of RM quality standards, but we also continue to propose 10 principles of a so-called good risk management system which can be used in most of companies, from small to medium to big size, esp. in developing countries including Vietnam as following:
Principle 1 – The company needs to evaluate RM from opportunity approach and based on risk-return trade-off.
Principle 2 – For project risk management, it is necessary to conduct SWOT analysis
Principle 3 – The company need to think of risk management strategy in the interaction with other business functions.
Principle 4 – RM standards are intended to be incorporated in to implementation forms that companies need to apply
Principle 5 – The company ensures both costs and benefits of RM analyzed fully.
Principle 6 – It may necessary for companies to develop Risk MIS system for better risk reporting
Principle 7 – The corporation understands RM importance and allocates more roles for accounting managers with risk activities/functions that added values
Principle 8 – The internal control system, management accounting need to go with RM functions and provide reports to support decision making
Principle 9 – Corporation needs to consider using PDCA cycle of Deming in risk management analysis
Principle 10 – Corporate management pay attention to construct quantitative model of risk and measurement of macro impacts on various kinds of risks: market risk , credit risk, liquidity risk, exchange rate risk, etc.
(Source: made by main author)