Performing the role of Chief Risk Officer: Reconceptualising Enterprise Risk Management in Search of Better Decision Making

Abstract

Enterprise Risk Management is a set of standardised and widely adopted ideas and designs for how organisations should pay attention to uncertainty. A principal claim of the international discourse around ERM is that it leads to improved enterprise performance through better decision making. In organisations the Chief Risk Officer is formally tasked with implementing ERM, but there is little relevant academic theory to inform this role. There is a dearth of supporting explanatory theory, and lack of insight with respect to translating world-level concepts of ERM into operational systems and processes in organisations. The thesis contributes to filling this gap by exploring ways in which CROs may understand and approach the decision support function of their roles. Empirical grounding was provided by a detailed, longitudinal case study of the implementation of ERM by the Corporate Risk Manager at Watercare Services Ltd. The case study was significant because of the CRM's principal focus on how ERM could support "better" decision making in the organisation. Theoretical grounding was provided by drawing on literatures from a range of disciplines to interpret and analyse the particulars of the CRM's performance, and to theorise the decision support function of the CRO role. The following question served as the focal lens for the inquiry: How should CROs understand their role with respect to "improving" organisational decision making, and what strategies might they employ toward this goal? The principal claim that the thesis makes is that there are different legitimate ways of conceptualising ERM and thus of interpreting the role of the CRO. Those different ways of "seeing" imply different possibilities for acting, which may be more or less effective with respect to improving decision making quality. The thesis argues that, of the identified perspectives, one is more likely to be workable as a basis for productive intervention by CROs than the others. Methodologically the thesis employs transdisciplinary modes of knowledge production. This is reflected in the wide range of literatures with which the thesis engages, the collaborative Dialogues between researcher and practitioner where we reflected on the complex problematics and uncertainties encountered, and the hermeneutic approach to the analysis, characterised by constant questioning and re-articulation of preconceptions through dialogical confrontation. Although far from typical of engineering research, the thesis illustrates and contributes methodologically to the current debate about the appropriate scope of education for engineers in the 21st Century.