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Drivers for enterprise risk management in Chinese construction firms: an empirical study
Enterprise risk management (ERM), as a holistic approach to risk management, has been applied in various industries and advocated in construction firms. ERM implementation can be influenced by both drivers and hindrances. The objective of this study is to identify the critical drivers for ERM implementation in Chinese construction firms (CCFs). To achieve the objective, a total of 17 drivers were identified through a literature review and a questionnaire survey was performed with 119 responses from 119 different CCFs in the global market. The analysis results indicated that 15 out of the 17 factors significantly drove ERM implementation in CCFs, and that “competitive advantages”, “improved decision-making”, “reduced costs and losses”, “increased profitability and earnings” and “improved control of an enterprise over its projects” occupied the top five positions. Additionally, all the drivers relating to the potential benefits of ERM were found to have significant influence. Because few studies have attempted to investigate the drivers for ERM implementation in construction firms, this study can add to the existing knowledge relating to ERM. This study also provides practitioners with an understanding of the critical factors that should be highlighted when they initiate ERM programs in construction firms.