Becoming the lamp bearer: the emerging roles of the chief risk officer

Book section : Chapter

Enterprise risk management, under the leadership of chief risk officers (CROs), has the promise to bring enterprise-wide risks, which threaten the achievement of the firm's strategic objectives, into the open and under control. Its organizational significance is that, by providing a process to identify, measure, monitor, and manage uncertainty in strategic decision-making, strategic planning, performance management, and deal-approval processes, it enables top management to maintain or alter patterns in risk-taking. This chapter addresses the question: How may CROs realize that organizational significance? I draw on the existing practitioner and academic literature on the role of CROs and on a number of case studies from my ongoing research program on the evolution of the role of the CRO. I outline and illustrate four major roles that senior risk officers may fulfill: compliance champion, modeling expert, strategic controller, and strategic advisor and discuss the contingencies that shape the mix and effectiveness of these roles in actual organizational settings.

Authors: Mikes, A

• Publication status: Published
• Peer review status: Peer reviewed
• Publisher: Wiley
• Host title: Enterprise Risk Management: Today's Leading Research and Best Practices for Tomorrow's Executives
• Pages: 151-166
• Chapter number: 8
• Publication date: 2021-06-04
• ISBN: 9781119741459
• Language: English
• Keywords: accounting; business processes; risk management; managerial roles; risk and uncertainty; governance controls
• Subtype: Chapter