An Examination of Enterprise Risk Management Practices in Nigerian Construction Companies: A Study of Julius Berger Nigeria Plc
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Background of the Study
Enterprise Risk Management (ERM) has become a critical practice for organizations operating in high-risk industries such as construction. By integrating risk management processes across all levels of an organization, ERM enables firms to identify, assess, and respond to risks in a holistic manner (Hopkin, 2024). In Nigeria, the construction sector is fraught with challenges, including project delays, cost overruns, regulatory uncertainties, and environmental hazards, which necessitate robust ERM frameworks.
Julius Berger Nigeria Plc, a leading construction company, exemplifies the complexities of operating in this sector. The firm’s ability to deliver large-scale infrastructure projects hinges on its capacity to manage risks effectively. ERM provides a structured approach to managing these risks by aligning risk management practices with strategic objectives and fostering a risk-aware culture (Hillson, 2025).
Despite its benefits, the adoption of ERM in the Nigerian construction industry faces challenges such as inadequate expertise, resistance to change, and limited technological infrastructure. This study examines ERM practices at Julius Berger Nigeria Plc, focusing on their effectiveness in mitigating risks and enhancing project success.
Statement of the Problem
The construction industry in Nigeria is characterized by high levels of uncertainty, stemming from factors such as economic instability, regulatory hurdles, and project-specific risks. Julius Berger Nigeria Plc, despite its prominence, faces challenges in implementing effective ERM practices due to fragmented processes, resource constraints, and resistance to change. These issues can lead to project failures, financial losses, and reputational damage (Okoro et al., 2023).
The lack of empirical research on ERM adoption in Nigerian construction firms further compounds the problem, creating a gap in understanding its impact on project outcomes. This study addresses this gap by exploring ERM practices at Julius Berger Nigeria Plc.
Objectives of the Study
- To evaluate the effectiveness of ERM practices in mitigating risks at Julius Berger Nigeria Plc.
- To identify the key components of ERM frameworks used by the company.
- To assess the challenges and opportunities associated with implementing ERM in the Nigerian construction industry.
Research Questions
- How effective are ERM practices in mitigating risks at Julius Berger Nigeria Plc?
- What are the key components of the ERM frameworks used by the company?
- What challenges and opportunities exist in implementing ERM in Nigerian construction firms?
Research Hypotheses
- ERM practices significantly mitigate risks at Julius Berger Nigeria Plc.
- The key components of ERM frameworks enhance project outcomes.
- Challenges in implementing ERM affect its effectiveness in the construction industry.
Scope and Limitations of the Study
This study focuses on ERM practices at Julius Berger Nigeria Plc, examining their components, effectiveness, and challenges. Limitations include access to proprietary project data and the generalizability of findings to smaller construction firms.
Definitions of Terms
- Enterprise Risk Management (ERM): A systematic approach to managing risks across an organization’s operations.
- Construction Risks: Potential threats that may impact the successful completion of construction projects.
- Project Success: The achievement of project objectives within predefined constraints such as time, cost, and quality.
