Global pharmaceuticals company begins its ERM journey

Client background

A large health and life sciences company is known for being a leader in RNA therapeutics, specializing in genetic treatments. The company has a global presence—employing over 1,400 people with operations in the biopharmaceutical industry—offering a wide range of products for rare genetic diseases. The company was looking to establish a foundation for a right-sized enterprise risk management (ERM) program by utilizing governance components to take advantage of upside opportunities while preventing and reducing risk-related downsides.

The business challenge

The company needed support in the design and implementation of its performance-based ERM program. Although the company leveraged its compliance and internal audit functions for basic assurance-related support, it lacked a group to manage its enterprise risks. Due to the size and complexity of the organization, information flowed through a multitude of committees and assurance groups, making it difficult to clearly pinpoint accountable parties and relevant stakeholders who should be involved and informed on risk management-related updates. The company also wanted an opportunity-enabling risk management program that could provide the organization with proactive risk-related insights to enable the strategic direction of the organization.

Strategy and solution

Baker Tilly worked closely with management to design an information flow diagram for risk-related information being shared throughout the organization. A tailored governance structure was then designed to best fit the needs of the company. This included the development of the following specific foundational components:

• An enterprise risk management committee charter and associated risk management policy
• A comprehensive risk management playbook, designed to walk a practitioner through the defined components of the risk management life cycle
• An information flow diagram along with a risk and accountabilities matrix (RACI) designed to provide clear visibility into ownership and responsibilities associated with the key elements of the risk management process
• A list of detailed risk appetite statements along with their associated risk tolerances to ensure alignment across the organization

In addition to the support provided in the design of the ERM program, Baker Tilly also served as in-house support to guide stakeholders through the key initial stages of the ERM process, including providing direct assistance with the following:

• Leveraging RiskSynergy™ to aid in the identification and assessment of the organization’s top 10 enterprise risks
• Working with leadership to assign ownership for risks that need to be actioned
• Working with risk owners to develop risk plans and collect relevant data for risk reporting and monitoring efforts (e.g., risk metrics, key risk indicators, status indicators)

The board chairman and former chief executive officer (CEO) has shown interest in having similar work carried out for several other companies where he serves as a board member.