Enterprise-wide Risk Management Drivers in the Mining Industry: Evidence from a Developing Economy

Description

1171-1178

Luke Charles Chikosi and Ashley Teedzwi Mutezo (Department of Finance, Risk Management and Banking, College of Economic Management Sciences (CEMS), University of South Africa, Pretoria, South Africa)

On a global scale, there has been a significant paradigm shift in corporate risk management practices. Large amounts of evidence from the risk management literature show that firms are transitioning from silo-based to enterprise-wide risk management (EWRM) approaches to improve sustainability and shareholder value. However, as the business environment has become more complex and diverse, the drivers for EWRM adoption have shifted. The purpose of this paper is to investigate the relationship between EWRM drivers and EWRM implementation in the South African mining industry. A questionnaire survey using a five-point Likert scale was employed to collect quantitative primary data from 136 purposively sampled risk practitioners, representing 67 members of the Minerals Council South Africa (MICSA), for the financial year ended 31 March 2024. Using analysis of variance (ANOVA) and correlation analysis, the study found a positive and significant relationship between EWRM drivers and EWRM implementation. Furthermore, using normalised values, the study found 32 out of 34 drivers for EWERM to be critical in the South African mining sector. The findings of the study may contribute to the existing body of knowledge, mining entities’ management, and regulators.