Abstract

The relationship between a firm’s risk management practices and the performance and profitability of the firm is assessed, as well as the impact of artificial intelligence on financial risk management and how that further affects firm performance. The article examines risk controlling practices post-financial crisis period to determine if the financial event was a deciding factor in most firm’s implementation of increased managerial practices towards risk. It was found that risk management, as accounted for in a firm’s capital structure, significantly affects profitability, if the firm is a financial institution. Non-financial institutions can apply effective risk management techniques through other firm operating activities and applying targeted financial instruments.

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