This exploratory study reports the results of a survey investigation into the enterprise risk management (ERM) practices of large manufacturing firms in Italy, especially in relation to risk identification stage and the use of sophisticated risk assessment techniques. The survey is based on a sample of 58 large firms. Responses reveal that more than half of the surveyed firms have implemented ERM or are in the process of implementation. Further, most of the responding firms explicitly focus on potential events that can affect firm performance and the ability to achieve objectives, and each source of strategic risk (operations risk, asset impairment risk, competitive risk, and reputation risk) is perceived to be highly important in risk identification efforts. The analysis on the use of sophisticated risk assessment techniques reveals significant adoption rates among the surveyed firms that explicitly focus on strategic risk sources. In particular, firms use both quantitative and qualitative techniques, suggesting that both the output of quantitative probabilistic and non-probabilistic models and managerial judgement involved in the use of risk maps can play a key role in estimating probability and impact of risk events. However, sophisticated techniques are mostly attributed a moderate degree of importance, and this could be a signal of the difficulties inherent in risk assessment. In fact, as acknowledged in literature, there are events whose impact can hardly be predicted. The main limitation of the study concerns the number of the surveyed firms, that reflects the exploratory nature of the study. To increase the validity of the results and to help determine the extent to which they can be generalised, they should be tested on larger samples.
