About this course
Chapter: Risk Management – CMA US Part 2
The Risk Management chapter provides CMA candidates with a strategic understanding of how organizations identify, assess, and respond to various types of risk that can affect financial performance and long-term sustainability. This chapter explores the key concepts of risk identification, including both internal and external sources of risk—such as market risk, credit risk, operational risk, legal and regulatory risk, and reputational risk. Students learn how to assess risk exposure through both qualitative and quantitative methods, including scenario analysis and value at risk (VaR).
A critical component of this chapter is Enterprise Risk Management (ERM), emphasizing a holistic approach to risk oversight across all functions of the organization. The COSO ERM framework is examined, detailing its components, including governance, strategy alignment, performance, and risk monitoring.
In addition, students are introduced to techniques for mitigating and transferring risk, such as insurance, hedging with derivatives, and risk avoidance. The chapter also highlights the role of the CFO and other key personnel in embedding risk awareness into corporate decision-making.
By the end of this chapter, candidates will be equipped to support risk-informed strategies, implement control mechanisms, and contribute to effective corporate governance in today’s dynamic and uncertain business environment.
