Risk Management Measurement and Evaluation Methods Based on Performance Indicators

Abstract

In recent years, audits of the State Audit Office of Hungary have detected numerous compliance and operational deficiencies in relation to the risk management practices of public sector institutions. This article presents a number of approaches and audit methods which, besides helping to meet compliance requirements, provide assistance in implementing and operating effective risk management. Under the international projects launched by the Budapest Business School with a view to facilitating the application of the ISO 31000 risk management standard, a number of methods have been developed to enhance the governance capability of organisations and ensure its objective assessment. They offer guidance for determining the risk criteria indispensable for the implementation of effective risk management, including adequate risk acceptance levels. The proposed performance indicators for the governance process of enterprise risk management are equally applicable to public and private sector organisations and enterprises. Receiving the title “Budapest University of Business Administration” on 1 January 2016, Budapest Business School provides an adequate training framework for acquiring risk management methods.