4/20/2020 Understanding Enterprise Risk Management for Utilities © Copyright 2007, CCRO. All rights reserved. 14 The four categories provide consistency, MECE-ness, and fit across the spectrum of issues that an ERM program must tackle. Whether considering metric, governance, organizational, or reporting issues, all are aided by using a single set of risk categorizations and associated terminology. As if a glue were created by this categorization system, the insights presented by the ERM analysis and proposals hold-together well when challenged or studied. As diverse and complex as many projects undertaken by an ERM function in a utility may be, this risk categorization system is essential to clear and cohesive analysis. Advancing best practices for today’s competitive energy markets. “Glue” for ERM Program Integrated risk perspective of all businesses A control framework that is “value-added” to business units “Risk aware” investment allocation decisions Risk Integration Risk Control Risk Investment