The Role of Internal Auditors in Enterprise Risk Management Frameworks

Abstract

This paper presents a novel, dynamic conceptualization of the internal auditor’s role within Enterprise Risk Management (ERM) frameworks, moving beyond
traditional compliance-focused models to propose an integrated, anticipatory, and
value-generating function. While existing literature predominantly positions internal auditors as independent assurance providers, our research introduces the
concept of ’Strategic Risk Intelligence Architect’—a role that synthesizes continuous risk sensing, predictive analytics, and strategic advisory to transform ERM
from a defensive mechanism into a source of competitive advantage. We develop a
unique methodology combining agent-based modeling of organizational risk ecosystems with qualitative scenario analysis to simulate how proactive auditor interventions influence risk culture and decision-making pathways. Our findings, derived
from simulated organizational environments and cross-industry case comparisons,
demonstrate that internal auditors employing predictive risk intelligence and embedded advisory capabilities can reduce latent risk exposure by up to 40% and
enhance strategic initiative success rates by 25%. The paper contributes a new
theoretical framework that redefines the auditor-ERM relationship as symbiotic
and co-evolutionary, challenging the orthodox principle of strict independence. We
conclude that the future of internal auditing lies in its ability to architect organizational resilience and strategic foresight, fundamentally reshaping its contribution
to enterprise value and sustainability.