Enterprise risk management and firm performance: an empirical study among Malaysians public listed companies / Faiqah Safwanah Abdul Mutaliff

Risk are impossible to be avoided and eliminated and without risk management, firms may be threatened in many ways. Enterprise Risk Management (ERM) has emerged from the “silo” approach as portfolio for firms in managing risks. The significant growth of ERM implementation among Malaysian Public Listed Companies across the year questioned how does the implementation provide benefit to the company especially in measuring its performance. Despite the rising literature and studies conducted for ERM, the extend of ERM implementation and firm performance are still vague, especially when the measurement for ERM implementation always vary. Conflicting views on how ERM affect the firm performance requires research to provide on whether ERM does really affect firm performance or not. This study look in details on how the adoption of ERM is associated with firm performance based on basic risk management components, extracted from COSO (2004) integrated frameworks based on its strategic objectives. The study also extends in determining which components that significantly influences the firm performance. This study measures ERM implementation based on the public companies that are listed under Bursa Malaysia Main Market. A total of 137 public companies that are listed under Main Market has participated in this study. Based on the data, the study finds that the extent of ERM implementation does not significantly affect firm performance. The researcher also found that there is no relationship between ERM and firm performance but one of the ERM components; risk monitoring and reporting do significantly influences firm performance.