KPMG Japan Launches Support Service for Advanced ERM Using Generative AI

KPMG member firms—Azusa Audit Corporation, KPMG Consulting Co., Ltd., and KPMG Forensic & Risk Advisory Inc.—are launching a support service for advanced Enterprise Risk Management (ERM) utilizing generative AI.

The external environment surrounding Japanese companies is becoming increasingly complex due to factors such as geopolitical risk, pandemics, supply chain fragmentation, technological hegemony, climate change, and rapid technological innovation led by generative AI, making future forecasting more difficult. Under such business environments, situations where the prerequisites for business strategies change significantly in a short period are increasing. Consequently, a shift from traditional "static ERM focused on loss prevention" to "more dynamic ERM directly linked to flexible management judgment and strategy formulation" is required.

KPMG Japan has pooled the knowledge and experience in strategy and risk management held by Azusa Audit Corporation, KPMG Consulting, and KPMG Forensic & Risk Advisory to provide this ERM enhancement support using generative AI as a systematic service. This service conducts dynamic risk scenario analysis and risk quantification using generative AI, and integrates strategic and risk response options based on multiple future scenarios into the management decision-making process, enabling rapid and high-quality management decisions even in uncertain environments.

Key features of this service include:

- Significant improvement in speed, objectivity, and flexibility of risk analysis through generative AI. - Visualization of risk impact propagation and multiple future scenarios/strategic options, along with quantitative risk assessment. - Timely, frequent, and continuous monitoring of risk factors for immediate reflection in management.

By fusing the knowledge accumulated in accounting audit, strategy consulting, and risk advisory with advanced AI technology, KPMG Japan aims to create a new standard for ERM that captures strategy and risk as one, supporting sustainable value creation for enterprises.