Empirical Study on Enterprise Risk Management Adoption in Taiwan: The Relation between ERM and Firm Characteristics

• Main Authors: HAN-WEI HUANG, 黃瀚緯
• Other Authors: 作者未提供
• Format: Others
• Language: zh-TW
• Published: 2011
• Online Access: http://ndltd.ncl.edu.tw/handle/87800683623395215761

碩士 === 銘傳大學 === 風險管理與保險學系碩士班 === 99 === Enterprise risk management (ERM) has been the topic of increased media attention in recent years in Taiwan. After the recent wave of corporate governance scandals and the financial tsunami, ERM that accurately reflects risk of enterprise is one of the most important operations performed by organization. Despite the increased attention on ERM in Taiwan, little academic research has been done to explain why some organizations adopt ERM while others do not. The objective of this study is to examine the differences between a sample of firms that have announced the appointment of CROs and a closely matched control sample in TWSEC-Listed financial holding companies. We use a logistic regression framework to study the effect of adoption of ERM principles on firms’ long-term performance by examining how firm characteristics change around the time of ERM adoption. The logistic results provide evidence of a significant negative relationship between the market-to-book ratio and the likelihood of appointing a CRO. It is implying that lower market-to-book ratio firms are more likely to appoint a CRO than other firms of a similar size that operate in the financial holding companies.