Application of Enterprise Risk Management at Airports (2012) / Chapter Skim
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Pages 16-23
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From page 16... ...
16 Governance and infrastructure provide the platform and structure on which to build and develop ERM across an airport. It is important to consider each step outlined in this section, to ensure that the pillars providing the foundation for ERM are established and tailored to the airport culture, structure, and objectives.
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Governance and infrastructure 17 – Break down silos and ensure an enterprise-wide approach to managing risk. – Integrate key risk processes across the airport to add value and reduce duplication of effort.
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18 Application of enterprise Risk Management at Airports 3.2 Determine Risk Appetite An organization's risk philosophy is a set of shared beliefs and attitudes characterizing how the organization considers risk in its business operations, from strategic planning and implementation to day-to-day activities. A risk philosophy should reflect the organization's mission and values, governing structure, and the industry and regulatory environments within which the organization operates.
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Governance and infrastructure 19 tion points, and identifying the escalation process for risk outside the acceptance criteria, capability, or capacity. • Include quantitative statements -- described as limits, thresholds, or key risk indicators -- which set out how certain risks and their rewards are to be judged and how the aggregate consequences of risks are to be assessed and monitored.
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20 Application of enterprise Risk Management at Airports 3.4.2 Gain Management Commitment Successful ERM implementation requires airport senior management to be fully committed to the ERM framework and processes. Below are some frequently asked questions with associated answers to help overcome common challenges: • At this airport, I am too busy dealing with today's issues; I don't have the time and energy for ERM.
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Governance and infrastructure 21 • What will be the immediate results and efficiencies? ERM is not something that will automatically result in short-term savings and efficiencies.
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22 Application of enterprise Risk Management at Airports current risk management processes, resource capabilities, skill sets, existing processes, size, and structure. An example of an ERM governance framework is provided in Figure 3.
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Governance and infrastructure 23 and risk management education while also facilitating cross-functional discussion on significant risk management issues. This approach is operating successfully in many North American airports and airports around the world.
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