Pub. 3 2012 Issue 4

www.wvbankers.org 26 organization’s risk profile, by evaluating whether the organization will be riskier, less risky or risk-neutral. • ERM always leads to actions taken to increase, reduce or accept the balance of risk and reward for each risk category, asset class and new opportunity under consideration. The Third Principle of ERM – While Enterprise Risk Man- agement integrates many of the risk management activities currently in operation, it creates a very different and unified approach. So ERM does have a life of its own. Although the following certainly have a place in the ERM con- versation, ERM is a new and unique management process. ERM is NOT JUST: • About risk levels. • Intended to satisfy the regulators. • An assessment of internal controls. • An extension of regulatory and legal compliance. • Simply an expansion of SOX. • A further elaboration of FDICIA. • A further description of the CAMELS regulatory rating process. The Fourth Principle of ERM – An effective ERM process answers four key questions: 1. Do we understand the risks we are taking across the company (enterprise)? 2.What is the reward? 3. Is the risk acceptable? 4. Is the reward great enough? The Fifth Principle of ERM – ERM is a dynamic link be- tween strategy, opportunity, risk and reward. In the end, the operating principles of authentic Enterprise Risk Management assess the dynamic principles of risk and reward in providing the link between strategy, performance and risk management. An important aspect is the ongoing identification and evaluation of internal and external events that have the potential to positively or negatively impact the company’s strategic objectives. Event scenario planning ad- dresses the “what if” or emerging risks and opportunities, avoiding surprises furthering the consistency of performance. Employing the ERM principles will create a better, stronger and more effective company. Q Jack R. Salvetti is the President of S.R. Snodgrass, A.C., an expert accounting and consulting firm specializing in services to financial institutions. His unique combination of consulting experience and CPA background helps institutions understand and define their business to facilitate the development of plans that deliver measurable results. Nancy D. Schell is a Senior Vice President with S.R. Snodgrass, A.C. Nancy is the Director of the firm’s Financial Services Consulting Group specializing in the areas of Strategic Planning, Enterprise Risk Management, Organizational Design, Profit Enhancement and Process Improvement. February 12 BSA/AML (Charleston), Co-Sponsored with PBS 13 BSA/AML (Bridgeport), Co-Sponsored with PBS 19 Bankers Day at the Capitol and Legislative Reception 21 IRA Basics 22 IRA Advanced March 17-22 ABA National Commercial Lending School 19 Deposit Compliance (Charleston), Co-Sponsored with PBS 20 Deposit Compliance (Bridgeport), Co-Sponsored with PBS 27 & 28 Bank Security School April 7-12 GSB Bank Technology Management School 10 & 11 Operations/Technology Conference 16 & 17 Branch Management Series 18 Asset Liability Management 21-26 GSB Human Resource Management School May 2 & 3 2013 Credit Management Conference 9 Financial & Estate Planning Seminar 19-24 WV School of Banking 19-24 Lloyd P. Calvert Graduate School of Banking Dates to Be Announced • Compliance Seminars/School • Foreclosures/Bankruptcies/Collections • Bank Management Forum Visit www.wvbankers.org and click on the Event Calendar as new events are added. Webinars — Live and Recorded Visit our website www.wvbankers.org as dates and topics are announced . Graduate School of Banking Online Senior Management Seminars Visit www.gsb.org or our website as updates are added. Calendar of Events R gister online at www.wvbankers.org