New ERM Framework with Multicriterial Decision Method and Multiple Linear Regression based on ISO 31000q

Abstract

Risk Management (RM) plays a vital role in strategic business management, as it allows you to quickly
identify and manage threats that may arise during the execution of your business. These strategic risks or
issues play an important role in the survival and performance of the company. Indeed, companies may be
establishing an efficient and structured Enterprise Risk Management Framework (ERM). Our work
proposes a global methodology for the development of Entreprise Risk Management Framework based on
an identification of strategic risks and challenges external to the company, an assessment and evaluation
of these risks according to a combined approach of the methods of MCDM multi-criteria decision support
"Analytic Hierarchy Process" (AHP) for the weighting of selected criteria and "Technique for Order
Preference by Similarity to Ideal Solution" (TOPSIS) for risk prioritization and the Pareto Diagram to
evaluate and to select the significative risks and to predict the cost of controlling and preventing these risks
through multiple linear regression (MLR). The study also provides a new method of framework ERM which
may suggest satisfactory methods with validating results.