The Impact of Enterprise Risk Management and Competitive Advantage on Firm Performance: Future Research

Abstract

Enterprise Risk Management (ERM) has emerged as a key point in academic and professional spheres. While it is gradually being recognized to have potential benefits, there still exists a significant gap related to what exactly the relationship ERM and firm performance intensively means. This ongoing research endeavors to fill this void by exploring the influence of ERM and aligning its dimensions with concepts of competitive advantage. This paper aims to present a comprehensive overview of ERM, utilizing the Resource Based View (RBV) and Contingency theoriesas a lens to examine its effects on the performance of non-financial firms, where competitive advantage serves as a mediating factor. Building upon existing research, this study contributes novel insights, particularly in the intersection of strategy and ERM. The findings of this research not only dissect the pivotal components of ERM and their ramifications on firm performance but also provide practical insights. These insights can function as a roadmap, bridging the expectations of managers concerning ERM with its actual implementation within the context of competitive advantage strategies. This study thus seeks to enhance the understanding of ERM's strategic implications and offers actionable recommendations for effective integration into organisational frameworks.