Critically analyse the role of the board of directors and senior Essay

Critically analyse the role of the scorecard of directors and senior make lovement in managing enterprise risk in an push company - Essay mannequinEnergy and Resources companies take up come increasingly under the regulatory purview. Due to brisk changes in the assiduity, they subject stiffening regulatory requirements, ever-increasing cyber issues and rapidly changing technology. Such compliances and risks have a strong impact on the companys operations and business strategies that makes it utterly imperative for the management to adopt approaches to manage and extenuate risks and cope up with regulations. Risk Management in the Energy Sector A good further has been made in the past in developing comprehensive enterprise risk management (ERM) programs. ERM is toughened to become an industry standard for management of risk because it is probably the most effective way to manage risk internal or external to the organization (Accenture Global Risk Management, 2011). The key r isk areas that have been identified for aught and resources area can be listed as follows 1. High competition in the industry participants Energy industry participants have a very unique competitiveness. Each player has a opposite advantage within the industry. One firm may have a good resource assume while the other might be a technologically strong firm and a trio would have a huge market. Nowadays, competition is shifting and each firm is trying to develop on every frontier. International firms are thus facing challenges by national players reducing their market size. 2. special(a) sources of alternative energy Despite the fact that there are alternatives to limited source of non renewable energy, energy companies still havent been able to progress much on developing much on alternative sources. Alternate sources have an irreplaceable demand, but on the supply grimace, they face a band of constraints. There hydrocarbon content on earth is enough to last a century, but the problem lies in lack of knowledge on its development and usage. These sources are limited by limitations in scale, feasibility and fitness (Holmes, 2004). 3. Government Interventions Most of government regulations in the energy industry are directed towards regulating supply. usable policies, regulations on carbon emissions and energy security norms affect both the demand as well as the supply side of energy business. Role of Board of Directors and Senior Management Post recession, the scene for energy companies has not lonesome(prenominal) been tough but also challenging in terms of greater proletariat undertakings and complex compliances. Companies have also had to venture in remotest regions simply to manage demand and supply side challenges. Management has to focus on strategy, production, enterprise risk along with operational excellence. With the advent of regulators, management has started to recognise the need for risk management to enhance business performance. With t ime, a lot of change has come in managing enterprise risk. New tools, better techniques and risk measuring methodologies have come up. One can only predict how enterprise risk management shall evolve in the coming times. As Energy sector risk officers, senior managers and the board of directors need to be have the capability to comprehend what possible risks could potentially arise in the near future and how exactly to take preventive measures that will help in combat. With such approach, all downsides that