A study by Aon and the University of Pennsylvania’s Wharton Business School has established a relationship between the maturity of a company’s risk management framework and its financial performance.

The Aon Risk Maturity Index is an online tool created to help risk and finance leaders to assess the development level of their organisation’s risk management structure and implementation.

Theresa Bourdon, Group MD of Aon Global Risk Consulting – Americas, says the study “answers the question business leaders have been asking for years: does better risk management really make a difference to our bottom line?”.
 
“We are seeing firms that rate above average in risk maturity differentiate themselves in three areas: risk complexity awareness, formal agreement on risk management strategy/expectations, and the degree to which organisational architecture is aligned to support achievement of risk management objectives.”

The index involves a series of questions focused on corporate governance, management decision processes and risk management processes.

Aon and Wharton then analysed the responses to identify those activities associated with improved financial performance, and participants received a risk maturity rating, comments for improving the rating and insight into the levels of risk maturity globally.

As the index database grows, Aon and Wharton will look to identify the specific sets of activities that deliver the greatest return on investment and how they may differ by industry.