Caremark and Enterprise Risk Management‪.‬

I. INTRODUCTION Enterprise risk management is the process by which the board of directors and executives of a corporation define the firm's strategies and objectives so as "to strike an optimal balance between growth and return goals and related risks." (1) It encompasses determining an appetite for risk consistent with the interests of the firm's equity owners and identifying, preparing for, and responding to risks. (2) Although primary responsibility for risk management rests with the corporation's top management team, the board of directors is responsible for ensuring that the corporation has established appropriate risk management programs and for overseeing management's implementation of such programs. (3)