COSO Enterprise Risk Management (ERM) Framework (2017)
Strategy and Objective-Setting – COSO Enterprise Risk Management (ERM) Framework (2017)

COSO Enterprise Risk Management (ERM) Framework (2017) P8: Principle 8: Evaluates Alternative Strategies

Alternative strategies are evaluated, together with the effect each could have on the risk profile. Strategy must support the mission and vision and align with core values and risk appetite; each alternative strategy carries its own risks and opportunities, so the organization identifies and understands the implications of each, forming a risk profile per option, with effort and precision in proportion to how significant and complex the decision is and using approaches such as SWOT and scenario analysis; the selected strategy must be one that can be carried out within the risk appetite, or it is revised, an alternative chosen, or the appetite revisited; strategy is changed when it no longer creates, preserves or realizes value, or when the business context moves the entity toward the boundary of acceptable risk; and bias in strategy-setting is identified and mitigated.

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