IMPACT OF ENTERPRISE RISK MANAGEMENT (ERM) ON ORGANIZATIONAL PERFORMANCE
Abstract
Enterprise Risk Management (ERM) is an integrated framework monitoring tool for managing uncertainties surrounding business objectives. The study examined the impact of ERM on financial performance of three (3) Insurance Companies in Zaria Local Government Area. The descriptive results showed that the mean Return on Investment (ROA) was 0.0283. The results show that all the enterprise risk management measures had high mean values which suggest that these practices were practiced highly by the fund management firms surveyed. The regression results revealed that the model accounted for 100% of the variance in financial performance as shown by the R2 value. The F-statistic of 34.0 was significant at 5% level, suggesting that the model was fit to explain the relationship between enterprise risk management and financial performance. The coefficient results showed that event identification, risk assessment, control activities and information communication had negative effects on the financial performance of Insurance firms in Zaria, while risk response, internal environment, and objectives setting had positive effects on the financial performance of Insurance firms in Zaria. However, the effects of even identification and risk response on financial performance were insignificant at 5% level.
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