Achieving Enterprise Stability Based on Economic Capital
In a highly competitive environment, companies can focus too much attention on maximizing profits in the short term, while neglecting basic principles of the risk management process. Many bankruptcies, including those of big and successful companies listed on the New York Stock Exchange (NYSE), have stemmed from a failure to plan for the downside of risk. Enterprise stability and a company’s chance for survival can … [ Read more ]
Content: Article | Author: Zbigniew Krysiak PhD | Source: Graziadio Business Report | Subject: Risk Management
Zbigniew Krysiak
The concept of Enterprise Risk Management (ERM) sprung from the shortcomings of Value Based Management (VBM). This approach does not take into consideration the relative change between risk dynamic and the dynamic of value. Forgetting this type of analysis led in the past to instances of a very satisfactory and high increase in value, even though the company went bankrupt. Therefore, in the business environment, … [ Read more ]
Content: Quotation | Author: Zbigniew Krysiak PhD | Source: Graziadio Business Report | Subject: Risk Management