Case Studies On The Comprehensive Risk Management Implemented By Chalco Liancheng Branch

Under the specific conditions and within a given period, risk refers to the negative difference between results that may occur and the expected results, the uncertain impact on the target and the lost opportunity or possibility. The implementation of a comprehensive risk management is the process and methods that the enterprises around the overall business objectives implement the basic process of the risk management in all aspects of the enterprise management and the course of business, cultivate a good risk management culture, establish and improve the comprehensive risk management system so as to provide reasonable assurance to achieve the overall objective of the risk management.Since the1970s, with the development of market economy and the establishment of modern enterprise system, internal control of the enterprise and risk management theory and practice had rapidly developed. Internal control system had gradually developed into the internal control frame integration and risk management stage and the development trend of risk management was to conduct a comprehensive risk management. In this process, the symbolic significant event leading and promoting the world’s internal control and risk management development could be summarized as the establishment of the framework of the COSO report, the trigger of Enron and Arthur Andersen Scandal and the strong push of2002Sarbanes--Oxley Act. Guidelines on Enterprise Legal Risk Management and Basic Standards for Enterprise Internal Control issued by our government and relevant departments were the important milestones of enterprise-wide risk management of Chinese corporate governance.The theoretical basis of a comprehensive risk management mainly referred to the Internal Control Framework published by COSO in1992and Enterprise Risk Management Framework released in September2004. Integrated framework of COSO was larger. In addition to define what was internal control and comprehensive risk management and determine the responsibilities and scope of internal control and comprehensive risk management, the main contents included with four goals, eight elements and both parts and executive levels were visually presented through the three-dimensional map to show the main contents of entire theoretical framework.Since2009, Chalco Liancheng Branch had established the following systems and carried out the work:Section404of2002Sarbanes--Oxley Act (hereinafter referred to as "404" intemal control system), internal control system and a comprehensive risk management system. Through years of work, a series of achievements were made and there were still some room of shortcomings and improvement. The case implemented by Chalco Liancheng Branch told us that if companies wanted to do a good job on comprehensive risk management, they must have a state-of-the-art risk management philosophy to guide the scientific development of enterprises:make sound risk management mechanisms to support the transformation of business strategy; gave a professional risk management in order to accelerate the construction of risk system; have a good risk management culture to promote the healthy development of enterprises; create a monitoring and assessment mechanism to ensure the system to operate normally and update.