From External Risk Signals to Enterprise Risk Management - Integrating Geopolitical Risk into the ERM Process of a Multinational Firm

Sammanfattning

This study examines how external risks can be integrated into the Enterprise Risk Management (ERM) process of a multinational finn, using geopolitical risk as an empirical lens. While contemporary ERM frameworks increasingly emphasize strategic and enterprise-wide risk governance, significant challenges remain in integrating externally generated uncertainty into förmal risk processes.The study adopts a qualitative case study approach based on semi-structured interviews with respondents across multiple organizational functions, including risk management, business intelligence, security and supply chain management. The empirical material was analyzed through a theoretical framework centered around externa! signal detection, organizational interpretation, and organizational embedding.The findings demonstrate that externa! risks are not integrated into ERM through a linear or standardized process. Rather, integration occurs through a series of organizational translation processes in which external uncertainty is progressively transförmed into internally manageable and decision-relevant risk representations. Throughout this process, ambiguity, contextual nuance and qualitative dimensions of external uncertainty are gradually reduced in order to fit the comparability and quantification demands of the förmal ERM structures.The study further identifies several structurally interconnected breakdown points within the integration process, including selective signal filtering, fragmented interpretation, and tensions between qualitative uncertainty and quantitative risk requirements. The study contributes to the ERM literature by conceptualizing external risk integration as a process of organizational translation rather than direct incorporation.