Enterprise Risk Management
ERM
* Toronto Stock Exchange Dey Report in Canada following major bankruptcies
* Large pension funds have become more vocal about the need for improved corporate governance, including risk management, and have stated their willingness to pay premiums for stocks of firms with strong independent board governance.4
Increasing numbers of companies are undertaking enterprise-level approaches to risk—a more encompassing and systematic review of potential risks and their mitigation than most companies have undertaken in the past. Business units are tasked with identifying risks and, where possible, quantifying and determining how to mitigate them. These assessments typically are rolled up to a corporate level, sometimes with direct input from the board or audit committee. These assessments have often been relatively broad, focusing on reputation, litigation, product development, and health and safety risks, rather than focusing solely on financial risks. Where we have seen these assessments implemented we have commented favorably, particularly when the board or the audit committee is actively involved.5
Hydro One
Hydro One Inc. is the largest electricity delivery company in Ontario, Canada, and one of the 10 largest such companies in North America. Its predecessor, Ontario Hydro, was founded nearly a century ago, principally to build transmission lines to supply municipal utilities with power generated at Niagara Falls. Hydro One came into being in 1999 after legislation divided Ontario Hydro’s delivery and generation functions into two separate companies. Hydro One today consists of three businesses—(1) transmission, (2) distribution, and (3) telecom. Its main business (contributing 99 percent of revenue) is the transportation of electricity through the high-voltage provincial grid and low-voltage distribution system to municipal utilities, large industrial customers, and 1.2 million end-use customers.
* Hydro One is fully controlled by the
* Toronto Stock Exchange Dey Report in Canada following major bankruptcies
* Large pension funds have become more vocal about the need for improved corporate governance, including risk management, and have stated their willingness to pay premiums for stocks of firms with strong independent board governance.4
Increasing numbers of companies are undertaking enterprise-level approaches to risk—a more encompassing and systematic review of potential risks and their mitigation than most companies have undertaken in the past. Business units are tasked with identifying risks and, where possible, quantifying and determining how to mitigate them. These assessments typically are rolled up to a corporate level, sometimes with direct input from the board or audit committee. These assessments have often been relatively broad, focusing on reputation, litigation, product development, and health and safety risks, rather than focusing solely on financial risks. Where we have seen these assessments implemented we have commented favorably, particularly when the board or the audit committee is actively involved.5
Hydro One
Hydro One Inc. is the largest electricity delivery company in Ontario, Canada, and one of the 10 largest such companies in North America. Its predecessor, Ontario Hydro, was founded nearly a century ago, principally to build transmission lines to supply municipal utilities with power generated at Niagara Falls. Hydro One came into being in 1999 after legislation divided Ontario Hydro’s delivery and generation functions into two separate companies. Hydro One today consists of three businesses—(1) transmission, (2) distribution, and (3) telecom. Its main business (contributing 99 percent of revenue) is the transportation of electricity through the high-voltage provincial grid and low-voltage distribution system to municipal utilities, large industrial customers, and 1.2 million end-use customers.
* Hydro One is fully controlled by the