The Impact of Enterprise Risk Management on Business Performance of MSMEs in Cateel, Davao Oriental

Abstract

This study looked into how Enterprise Risk Management (ERM) practices are applied by Micro, Small, and Medium Enterprises (MSMEs) in Cateel, Davao Oriental, and how these practices relate to their business performance. Even though ERM is becoming more important today, many MSMEs especially in smaller towns still struggle with different types of risks. There is also limited local research that explains how ERM affects the performance of small businesses. To address this, the researchers gathered data from 94 MSME owners using a structured questionnaire and analyzed the results through mean, ANOVA, and Pearson correlation. The findings showed that ERM practices were generally high among the respondents, particularly in compliance and operational activities. Business performance was also rated high. Based on ANOVA results, there were no significant differences in both ERM practices and business performance when grouped according to business type or years in operation, which means the Impact of ERM among MSMEs is almost the same regardless of their size or age. Meanwhile, the correlation analysis revealed a moderate to strong relationship between ERM and business performance, suggesting that MSMEs with better ERM practices tend to perform better overall. In conclusion, the study highlights that ERM plays an important role in helping MSMEs become more stable and sustainable. Because of this, the researchers recommend that smaller and newer businesses be given more access to training and support programs that can help them strengthen their risk management practices.