IDEAS home Printed from https://ideas.repec.org/a/gam/jrisks/v13y2025i3p51-d1609992.html
   My bibliography  Save this article

The Assessment of Enterprise Risk Management Practices of Ethiopian Commercial Banks

Author

Listed:
  • Tsega Meseret Biresaw

    (Graduate School of Business Leadership, University of South Africa (UNISA), P.O. Box 392, Pretoria 0003, South Africa)

  • Athenia Bongani Sibindi

    (Department of Finance Risk Management and Banking, University of South Africa (UNISA), P.O. Box 392, Pretoria 0003, South Africa)

Abstract

The study aims to examine the enterprise risk management (ERM) practices of Ethiopian commercial banks. This approach is undertaken to examine the current approach to enterprise risk management within the Ethiopian banking context. A mixed-methods research design is employed which comprises content analysis and a survey study. The study found that the prevailing emphasis of risk management functions in Ethiopian commercial banks revolves on ensuring compliance with regulatory reporting standards. A significant number of the banks have implemented ERM programs primarily to meet regulatory obligations, rather than leveraging ERM to generate firm value. The study identified several gaps in the risk management function of Ethiopian commercial banks, including lack of integration of risk management with the banks’ mission and core values, failure to assess the resources required for effective risk management and to prioritise resource allocation accordingly, inadequate coverage of relevant activities and functional areas by both risk management and internal audit activities, and limitations on the assignment of chief risk officers (CROs) to oversee the risk management function within the banks. Overall, the maturity level of ERM implementation among Ethiopian commercial banks is moderate and requires further enhancement.

Suggested Citation

  • Tsega Meseret Biresaw & Athenia Bongani Sibindi, 2025. "The Assessment of Enterprise Risk Management Practices of Ethiopian Commercial Banks," Risks, MDPI, vol. 13(3), pages 1-34, March.
  • Handle: RePEc:gam:jrisks:v:13:y:2025:i:3:p:51-:d:1609992
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2227-9091/13/3/51/pdf
    Download Restriction: no

    File URL: https://www.mdpi.com/2227-9091/13/3/51/
    Download Restriction: no
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jrisks:v:13:y:2025:i:3:p:51-:d:1609992. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.