Can Strategic Risk Management Contribute to Enterprise Risk Management? A Strategic Management Perspective

Forthcoming: Bromiley, P., Rau, D., and Mcshane, M., 2016, Can strategic risk management contribute to enterprise risk management? A strategic management perspective. In T. J. Andersen (Ed.), The Routledge Companion to Strategic Risk Management (pp. 140-156). Routledge New York, NY 10017.

33 Pages Posted: 22 Oct 2014 Last revised: 19 Mar 2016

See all articles by Philip Bromiley

Philip Bromiley

University of California, Irvine

Devaki Rau

Northern Illinois University - Management

Michael K. McShane

Old Dominion University

Date Written: October 20, 2014

Abstract

Within the discipline of enterprise risk management (ERM), strategic risk management (SRM) has become a subject of increasing interest to practitioners and academics. To our knowledge, the term “strategic risk management” first appeared in the management literature in 1985 and 1986 (Jammine, 1985; Figenbaum & Thomas, 1986) and in the academic finance literature in 1990 (Rawls and Smithson, 1990), although early usage of the term did not clearly relate to later conceptions. The phrase has been in use even longer than ERM (Bromiley, McShane, Nair, and Rustambekov, 2014). Even with this longevity, the meaning of the term remains unclear, with confusion increasing with the advent of ERM. For example, does SRM mean the management of a specific category of risks known as “strategic risks” (AICPCU, 2013) or does SRM mean strategic actions/responses taken to mitigate major uncertainties facing the enterprise? Can any type of risk potentially become a strategic risk, or are only certain types of risk strategic? Is SRM a separate type of risk management or a subset of ERM?

Keywords: Strategic Risk Management, Enterprise Risk Management, ERM, SRM

JEL Classification: G30, L20, M10

Suggested Citation

Bromiley, Philip and Rau, Devaki and McShane, Michael K., Can Strategic Risk Management Contribute to Enterprise Risk Management? A Strategic Management Perspective (October 20, 2014). Forthcoming: Bromiley, P., Rau, D., and Mcshane, M., 2016, Can strategic risk management contribute to enterprise risk management? A strategic management perspective. In T. J. Andersen (Ed.), The Routledge Companion to Strategic Risk Management (pp. 140-156). Routledge New York, NY 10017., Available at SSRN: https://ssrn.com/abstract=2512477 or http://dx.doi.org/10.2139/ssrn.2512477

Philip Bromiley

University of California, Irvine ( email )

Campus Drive
Irvine, CA 62697-3125
United States

Devaki Rau

Northern Illinois University - Management ( email )

United States

Michael K. McShane (Contact Author)

Old Dominion University ( email )

Norfolk, VA 23529-0222
United States

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