Enterprise Risk Management (ERM)
What is ERM?
Enterprise Risk Management is a strategic approach that enables organizations to identify, assess, and manage risks across the business—including cybersecurity.
By aligning risk appetite with operational and strategic priorities, ERM helps the enterprise focus on initiatives that have the greatest business impact. It also supports compliance with critical regulations such as SOX, HIPAA, and GDPR.
Cybersecurity and identity management are integral to Enterprise Risk Management
ERM is designed to address risks across the organization. But cybersecurity and identity protection can’t remain isolated technical issues. They’re business-critical risks that directly influence strategic outcomes—and they belong in your ERM program.
Treating cybersecurity as part of ERM helps organizations:
- Breaks down silos between IT/security and the business
- Prioritizes security investments based on business impact
- Demonstrates due diligence to regulators and stakeholders
- Builds resilience against evolving threats
Why cybersecurity must be embedded in ERM:
Digital transformation expands the attack surface
From cloud infrastructure and remote work to digital customer experiences, every enterprise now operates in a digital-first world. That increased connectivity brings greater exposure to cyber threats.
Cyber risk is business risk
A ransomware attack, data breach, or identity compromise doesn’t just affect IT—it can:
- Disrupt operations
- Lead to regulatory penalties (GDPR, HIPAA, SOX, and more)
- Undermine customer trust and damage your brand
- Impact financial results and share price
Identities have become the new perimeter
In today’s hybrid environments, traditional network boundaries don’t apply. Attackers target identities—especially privileged accounts—because that’s where the access lives.
Regulators and boards expect visibility
Stakeholders demand transparency, whether it’s the SEC, EU DORA, or your board of directors. Cyber risks must be evaluated and addressed alongside financial, operational, and compliance risks—not buried in IT reports.
Cybersecurity is no longer optional in ERM. It’s essential to managing your enterprise risk landscape.
Example of Enterprise Risk Management in action
Here’s an example of ERM in a security risk scenario:
After a close call with a phishing attack that nearly exposes privileged credentials, a global financial services company brings cybersecurity into the spotlight of its ERM program.
Identifying the risk
The ERM team flags phishing and credential theft as key enterprise risks. With input from the IT security team, they gather data on attempted breaches and user behavior patterns to better understand the threat landscape.
Assessing the business impact
They quickly rank the risk as high. A compromise of privileged accounts could lead to regulatory fines, reputational damage, and data breaches—making it a critical issue to address.
Taking action
The organization implements Privileged Access Management (PAM) with just-in-time access and session monitoring to limit exposure. They strengthen defenses with phishing-resistant multi-factor authentication (MFA), updated email filtering, and improved security awareness training. The business continuity plan is revised to include rapid response protocols for compromised credentials.
Ongoing monitoring
Dashboards track privileged access activity, phishing trends, and user click-rates on suspicious emails. These metrics feed directly into the ERM system and are reviewed quarterly by the executive risk committee.
Strengthening governance
The CISO now sits on the enterprise risk committee. Cyber risks are included in the enterprise risk heat map and monitored alongside financial, operational, and compliance risks. Cybersecurity becomes an integrated part of the company’s risk strategy—not a siloed function.
As threats evolve and digital transformation accelerates, cybersecurity and identity protection can’t be treated as separate or secondary. They must be woven into your ERM framework to protect what matters most—your operations, your reputation, and your people. Start by assessing where cybersecurity fits into your current ERM strategy—and where stronger identity protection can make a measurable difference.
Related resources to help expand your ERM program
Blogs
Insider threat indicators: How to identify potential security risks
5 Least privilege examples in the enterprise
Streamlining compliance: The power of broad cybersecurity frameworks
Products