Some of these institutions were initially set up in a

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Some of these institutions were initially set up in a number of state organizations by passing themselves off as companies or credit cooperatives but later gradually expanded their illegal activities and became financial institutions without obtaining permits from the Central Bank of Iran (CBI). However, since these foundations have not received their permits from Iran's main fiscal governing system and, so far, have not been subjected to CBI oversight. They frequently flout the bank's orders and directives, violate its bylaws and, thus, create turmoil in the domestic fiscal market (Amini, 2015). H2 ERM Competitive Advantag e H1 IT strategy IT structure H4 H5 H3 Internal environment Objective setting Event identification Risk assessment Risk response Control activity Information & communication Monitoring
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ACCEPTED MANUSCRIPT ACCEPTED MANUSCRIPT For example, they offer higher deposit rates than government authorized banks as well as paying loan more t han twice the value of customers‟ loan deposit. Consequently, these institutions may be dissolved by the government or merge with other institutions or in many cases they faced bankruptcy due to the lack of resources (e.g., Mizan credit institution with 107 branches). All these create trouble and increase risks among the financial industry of the country. Harvesting from all the above discussions, it is really essential to improve the risk management system among Iranian financial institutions. Therefore, population of this study consisted of 91 financial institutions of Iran which implemented ERM as their risk management system. These institutions are recognized among companies listed on the Iranian central bank and Iranian central insurance websites, as well as on the stock exchange market website. With regard to recognition of implemented ERM institutions , the researcher looked for different words as proxies of ERM existence among the organization‟s annual reports. These includes words such as “chief risk officer”, “vice president enterprise risk management”, “risk management committee”, “executive risk manager”, “senior risk manager”, “head of risk manager”, and “vice president risk management” which is similar in approach to the studies of Liebenberg and Hoyt (2003), Gordon et al . (2009), Pagach and Warr (2007, 2010), Golshan and Rasid (2012). After recognizing practitioners from annual report the researcher called one by one to be sure of adopting ERM among these organizations. Then the questionnaires were administered. It should be noted here that as all branches of each of the financial institutions of Iran have to follow the rule and regulations of their headquarters; therefore, this study gathered information from headquarter of each institution as a representative of their branches.
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