With the Securities and Exchange Commission’s (SEC) adoption of Enterprise Risk Management (ERM), capital market operators (CMOs) and other market players now have the means to proactively identify, assess, and manage risks.
Commending the action the Association of Enterprise Risk Management Professionals (AERMP) emphasized that the “milestone demonstrates the SEC’s commitment to addressing the challenges in the capital market and promoting a risk-aware culture.”
In a statement by the professional body, it noted that the implementation of the ERM rides on a recommendation to the SEC on means to address the challenges of the capital market. AERMP stressed that the swift implementation demonstrates SEC’s shared commitment to innovative solutions.
While offering to collaborate with the SEC for a full implementation of ERM, AERMP further noted that the SEC swift implementation of ERM in the capital market is a significant step towards enhancing regulatory capacity and oversight.
The statement by AERMP partly reads
The Association of Enterprise Risk Management Professionals (AERMP) is delighted to commend the Securities and Exchange Commission (SEC) for its visionary leadership in introducing Enterprise Risk Management (CRM) in the capital market. This milestone demonstrates the SEC’s commitment to addressing the challenges in the capital market and promoting a risk-aware culture.
Our professional Association (AERMP) has consistently advocated for the adoption of ERM in the capital market. In our No. 1 recommendation in our ADVOCACY letter dated 5th June 2024, we emphasized the imperative of ERM in addressing the challenges in the capital market. The SEC’s prompt directive on ERM implementation, issued less than two weeks after our advocacy, demonstrates a shared commitment to innovative solutions.
The implementation of ERM in the capital market is a significant step towards enhancing regulatory capacity and oversight. ERM will enable the CMOs (Capital Market Operators) and all participants in the market to proactively identify, assess, and manage risks, ensuring a more robust and resilient capital market.
As a professional body dedicated to promoting CRM in both private and public sectors, we applaud SEC for taking the lead in implementing ERM. We are eager to contribute our expertise to ensure the successful execution of this initiative, enhancing the regulatory capacity and oversight function of the SEC.
We are proud to mention that our official relationship with SEC dates back several years ago and SEC has contributed significantly to and has taken a lead in some of our conferences and Induction programmes in the past. We are therefore always available to contribute our quota to the development and uplift of the capital market in Nigeria to its desirable position as one of the best in the globe, through the implementation of Enterprise Risk Management Framework.”
Recall that the SEC recently directed all CMOs to implement a standardized Enterprise Risk Management (ERM) framework. The initiative aims to strengthen risk-based supervision (RBS) and safeguard the capital market ecosystem.
Read Also: SEC Strengthens Capital Market with Mandatory ERM Framework
The SEC emphasized that by adopting internationally recognized standards like COSO, ISO 31000, and FATF recommendations, CMOs can establish a robust framework tailored to their specific operations.
