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Managing Risk and Opportunity: The Governance of Strategic Risk-Taking

Online ISBN:
9780191767333
Print ISBN:
9780199687855
Publisher:
Oxford University Press
Book

Managing Risk and Opportunity: The Governance of Strategic Risk-Taking

Torben Juul Andersen,
Torben Juul Andersen

Professor of Strategy and International Management

Professor of Strategy and International Management, Copenhagen Business School
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Maxine Garvey,
Maxine Garvey

Program Leader

Program Leader, The World Bank
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Oliviero Roggi
Oliviero Roggi

Professor of Finance; Visiting Professor of Finance

Professor of Finance; Visiting Professor of Finance, University of Florence; NYU Stern School of Business
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Published:
24 April 2014
Online ISBN:
9780191767333
Print ISBN:
9780199687855
Publisher:
Oxford University Press

Abstract

This book promotes good risk governance and risk management practices to corporate managers, executives, and directors, wherever they operate around the world. The major corporate scandals have their roots in governance failures, pointing to a link between risk governance and good performance outcomes. This topic is timely and of interest both to the academic community and to practicing managers, executives, and directors. The text focuses on contemporary risk leadership issues based on recent research insights but avoids excessive technical language and mathematical formulas. The book is framed around the challenges imposed on executives and directors in dealing with an increasingly complex and unpredictable world. This requires a new risk leadership focus that not only avoids the downside risks but also considers ways to exploit the upside potential offered by a dynamic environment. The underlying logic is built on the principles of financial economics where benefits derive from reducing bankruptcy costs and increasing future cash inflows. This provides a stringent framework for analyzing the effect of different risk management actions and behaviors in effective risk-taking organizations. Hence, the book addresses the potential for upside gains as much as the threats of downside losses that represent the conventional risk perspectives. It states the simple fact that you must be willing to take risk to increase strategic responsiveness and corporate maneuverability. The text builds the arguments in logical steps explicating relevant techniques and practices along the way that invite immediate application and practical thinking.

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