Method and System for Normalization and Aggregation of Risks

A data processing Enterprise Risk Management method, comprising the steps of:

• (a) providing an initial Enterprise Risk Management System risk matrix (ERM risk matrix) having a plurality of cells as basis;
• (b) using at least one processor to form an extended ERM risk matrix from the initial ERM risk matrix by adding at least one row of cells to the initial ERM risk matrix for mapping and scaling of at least one other risk matrix,
• (c) mapping the at least one other risk matrix by selecting a corresponding mapping area (800) in the extended ERM risk matrix and storing the selected mapping area (800) of the of the at least one other risk matrix,
• (d) using the at least one processor to perform scale normalizations of the at least one other risk matrix and the corresponding stored selected mapping area (800) in the extended ERM risk matrix to the same normalization ranges,
• (e) using the at least one processor to perform risk assessment normalization of risks assessed towards the at least one other risk matrix onto the corresponding selected mapping area (800) of the extended ERM risk matrix by selecting the mapping area (800) cell with normalized scale values mathematically closest to the normalized scale values of the risk assessment of the at least one other risk matrix, and
• (f) using the at least one processor to create normalized risks from the selected mapping area (800) cells in step (e).

A risk management system (100) comprising:

• at least one client (102),
• a network (106) providing communication links between various clients (102) connected together within the risk management system (100), the client (102) being provided with a communication device adapted to the network (106), a graphical user interface (107) and at least one processor for processing information, wherein
• the at least one processor includes software for:
• (a) based on an initial Enterprise Risk Management risk matrix (ERM risk matrix) having a plurality of cells, forming an extended ERM risk matrix by adding at least one row to the initial ERM risk matrix for mapping and scaling of consequences of at least one other risk matrix,
• (b) mapping the at least one other risk matrix by selecting a corresponding mapping area (800) of cells in the extended ERM risk matrix, and storing the selected mapping area (800) of the at least one other risk matrix,
• (c) performing scale normalizations of the at least one other risk matrix and the stored corresponding selected mapping area (800) in the extended ERM risk matrix to the same normalization ranges,
• (d) performing risk assessment normalization of risks assessed towards the at least one other risk matrix onto the corresponding selected mapping area (800) of the extended ERM risk matrix by selecting the mapping area (800) cell with normalized scale values mathematically closest to the normalized scale values of the risk assessment of the at least one other risk matrix, and
• (e) creating normalized risks from the selected mapping area (800) cells.