On 9 February 2021 the OECD made available on its website a copy of the Enterprise Risk Management Maturity Model.
Maturity models are a tool allowing tax administrations to reach an understanding of their levels of capability in certain functional, strategic or organisational areas. This can permit them to work out the types of changes that can lead to a higher level of capability over a period of time.
The OECD’s Forum on Tax Administration (FTA) is developing a series of maturity models allowing tax administrations to self-assess their levels of capability in functional areas of tax administration, such as auditing and human resource management; and in specialised functions such as enterprise risk management, analytics and the measurement and minimisation of compliance burdens.
The Enterprise Risk Management Maturity Model covers the organisational and operational aspects of enterprise risk management. Use of the model can help tax administrations to self-assess their level of capability through internal discussions and provide staff and senior leadership of the tax administration with a greater understanding of their level of capability on the basis of input received from various stakeholders across different parts of the organisation. The outcome can be used to decide strategy going forward and to identify the areas where further improvement is necessary, including areas where further support will be needed from other parts of the tax administration, from external stakeholders or from other parts of government.
Dialogue with other parts of the organisation during the assessment can help to identify the scope for synergies and identify areas where mutual support would be helpful. If an administration understands its own maturity level it can compare itself to other tax administrations and can link up with them for peer-to-peer learning.
The report issued by the OECD gives an overview of the model and explains its use. It sets out the results of pilot self-assessments that have taken place as the model was being refined and describes the self-assessment process undergone by the pilot tax administrations. The report also provides the model for use by tax administrations when they assess their own level of capability and how it can be used for international comparisons.
The model uses descriptors of overall tax administration capability in enterprise risk management. The levels of maturity in each area can be categorised as emerging, progressing, established, leading and aspirational. These categories are intended to facilitate discussions as to the relative or overall level of maturity in different areas rather than being a description of the overall level of maturity. The areas that can be examined include strategy, governance, culture, risk identification, risk analysis and evaluation and risk treatment.
