For companies that have decided to get more serious about enterprise risk management in 2011, the Committee of Sponsoring Organizations of the Treadway Commission is offering a few resources that might prove helpful.

COSO, a think-tank group focused on internal controls and risk management, has published two new white papers related to ERM intended to help companies formalize an informal program or refine one already in place. The first is “Embracing Enterprise Risk Management: Practical Approaches for Getting Started,” authored by Mark Friggo and Richard Anderson, professors at DePaul University. It describes how a company can get a formalized ERM program off the ground and how to work through perceived barriers that often prove to be stumbling blocks.

Friggo and Anderson's approaches are based on practices other organizations have followed successfully to develop an incremental, step-by-step method to launch an ERM program. The authors suggest specific, tangible actions that are intended to be adaptable and flexible to help a company get started.

The second paper is targeted at companies that need some focus on strengthening an existing ERM program with some tighter focus on key risk indicators. Titled “Developing Key Risk Indicators to Strengthen Enterprise Risk Management,” it is co-authored by COSO board member Mark Beasley and his colleagues at the ERM Initiative at North Carolina State University.

The paper's intent is to help management develop effective key risk indicators that will heighten board and management awareness of enterprise risk, all with an eye toward increasing the effectiveness of an existing ERM process and improving the execution of a company's strategy. Beasley says key risk indicators should serve as leading indicators of emerging risks that can be monitored to assure they don't derail the company's strategic objectives.

Related to but different key performance indicators, key risk indicators are metrics that can provide early signals of increasing risk exposures. They may take the form of ratios the board and management can track as indicators of evolving problems requiring corrective or mitigating action, or they may be more elaborate measures leading to risk scores. According to the authors, key risk indicators are derived from specific events or root causes that can interfere with strategic objectives, like a competitor's new product, a strike at a supplier's plant, or a change in the regulatory environment.