Impact of Organisational Culture, Enterprise Risk Management, and Risk Governance Capabilities on Business Value: The Evidence of Vietnam’s Joint-Stock Commercial Banks

Abstract

Every entity exists to provide value for its stakeholders and faces risk in pursuing value. Risk affects a business’s ability to achieve its strategy, objectives, and business value. An effective enterprise risk management (ERM) helps entities control their risks. Management optimises outcomes to enhance capabilities to create, preserve, and realise value.“ERM is the culture, capabilities, and practices integrated with strategy-setting and performance that organisations rely on to manage risk and create value”(COSO, 2017). The objective of this study is to assess the impact of organisational culture (ORC), ERM, and risk governance capabilities (RGC) on business value (BVA). Data were collected using a survey questionnaire. The respondents are managers and employees working in Vietnam's joint-stock commercial banks (JSCB). PLS-SEM is employed with SmartPLS software. The research results show that ORC, RGC, and ERM directly and indirectly impact BVA. The study suggests practical implications for Vietnamese JSCB in improving the value of the bank’s stakeholders.