Enterprise Risk Management: A Case Study on H&M Group

Enterprise risk management.

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Aims of organization...................................................................................................................3
Risk thresholds............................................................................................................................3
Identified threats and opportunities.............................................................................................7
Existing controls..........................................................................................................................9
Calculations of risk...................................................................................................................10
Mitigation actions......................................................................................................................10
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
Risk management is the important and effective part of the enterprise because this creates
various problems for business and for its growth factors. It is regarded as the assessment and
identification of the risk. That is followed by the application of economic resources project and
the proper coordination in order to reduce the impact of unfortunate events. Risk management is
the process of identifying and assessing as well as controlling threats to an organization's capital
and earnings. The present report is based on the “H&M” group which is the Swedish
multinational clothing company known for its fast fashion clothing for men, women, teenagers
and children. The report will include the aim of organization with its possible risk which are
faced by company and make solutions for solve those risk in proper manner. This will also
identify and analyse the threats and opportunities with controlling techniques and calculations of
risk threshold. This will also apply by mitigations actions for enhance opportunity of business.
MAIN BODY
Aims of organization.
The H&M group aims to be a catalyst for sustainable change across the fashion industry
which is the Swedish fashion company has set itself some of the number has its highest
sustainability to the target customer. The more advanced sustainability of goals at the industry
today has proper uses of management. The main goal of company is to become 100% circular as
well as lead the changes to as sustainable fashion by being an equal and fair company in the
proper and effective manner. The main risk which is faced by company that are social changes
like “weather conditions” as the operating performance of the group particularly affecting sales.
This may give negative impact on company because that affect to sales of company.
Risk thresholds.
This is the amount of risk which an organization or individual is willing to accepts that
risk in proper manner by using various concepts. This shows a clear picture of risk which will
faced by H&M (Bromiley and et.al., 2015). The company is faced various risk which are
analysis by using risk management process. Risk management process is occurs proper uses of
work at the workplace by creating more and identifying proper risks which are faced by H&M
group. This includes four steps which are as follows:
Step: 1 Risk identification:

This is the first and foremost step of risk management process which is help to makes and
identify a proper which are faced by H&M group in the proper manner by considering their goals
(Harrison and Lock, 2017). As per this stage, here is find risk which are change in taste and
preference of customer, weather conditions, Financial risk and operational risk.
Step: 2 Risk assessment:
This is the second stage where management is asses the risk management in proper
manner by assessing and identifying risk which are faced by H&M company. The risk which are
identified at the place which can affect to business and its performance like safety, resources,
work performance and reputation of company. The likelihood is an informal way of discussing
the likelihood which something will happen without specific references to the numerical
probability. This is typically used to refer are the events that have responsible probability of
occurring management goals. The likelihood of risk are as follows:
 The likelihood of social changes which is occurs through the weather condition is
probability because most of the peoples are thinks to purchase woollens in the off-season
because this provides benefits to customers with cost but that creates losses for company. Another risk of company is changes in taste and preference of company. This may
occurs when company is launched new product at market place (Schönsleben, 2018). In
that case, if customers are not like this product then its occurs problem for company. This
is the likelihood of this risk which is highly impact on business and H&M group. Financial risk is assess through the funding resource in case of loan. The company is
taking loan as per requirement with another sources than likelihood is probable because if
rate of interest is increase. In that company need to pay extra amount and creates problem
for company.
 Operational risk is asses with market demand because through that company need to
make proper research and development strategy (Brindley, 2017). This is directly affect
to company and their needs factors by consisting growth factors in negative manner.
Step: 3 Risk response development:
This stage is very important and effective for H&M which is creates and handle those
risk in proper manner by making some strategies for business which are as follows:
 The company can use a market observation and select various alternative and design
solutions.