Effectiveness Of Risk Management System Research Articles

The Use Of Mathematical Tools Of Reliability Theory In The System Of Economic Security Of An Industrial Enterprise

Introduction: This research uses mathematical tools of reliability theory in an industrial enterprise's economic security system. The authors argue that a highly effective risk management system is essential for ensuring the necessary level of economic security for any business entity. The study aims to substantiate the necessity and expediency of using the characteristics and indicators of reliability theory in an industrial enterprise's economic security system. Theoretical framework: The study is based on the theoretical framework of reliability theory, which provides mathematical tools for analyzing and managing risks. The authors discuss the most critical indicators of reliability theory, including the value of reliability, the failure rate of risk events, the time to failure, the time-to-failure density, and reliability. Methodology: The study employs a qualitative research methodology, which involves a comprehensive review of the literature on the use of reliability theory in an industrial enterprise's economic security system. The authors analyze the literature to identify the key components of an industrial enterprise's highly effective risk management system. Results and Discussion: The study finds that using mathematical tools of reliability theory can significantly enhance the effectiveness of risk management systems in ensuring economic security for industrial enterprises. The authors identify several key components of a highly effective risk management system, including systematic monitoring of the competitive environment, continuous assessment of the place of the enterprise in the market and its respective segments, and the use of reliability theory to analyze and manage risks. Conclusion: The study concludes that using mathematical tools of reliability theory can provide valuable insights for developing effective risk management systems in an industrial enterprise's economic security system. The authors recommend that industrial enterprises adopt a proactive approach to risk management, which involves continuous monitoring and analysis of risks, and use reliability theory to manage risks effectively.

Assessment of the effectiveness of the risk management system

The article is devoted to the study of modern approaches to assessing the effectiveness of the risk management system (RMS) of an organization, presented in current risk management standards, regulator recommendations and in the scientific literature on this issue. Based on the assumption that the effectiveness of the risk management system can be assessed by comparing the achieved result with the RMS efficiency criterion, the authors studied the methodological approaches and evaluation criteria proposed in the documents regulating risk management, as well as by specialists. As a result of the analysis, it was found that in the specialized literature on the problem of risk management, there is no generally accepted definition of the effectiveness of RMS, as well as clear criteria for its evaluation. An analysis of approaches to assessing the effectiveness of the RMS made it possible to identify the key elements and processes of risk management. Criteria and methodology for evaluating the effectiveness of the organization's risk management system are proposed, taking into account the degree of implementation and the effectiveness of the functioning of the RMS elements. Evaluation of the effectiveness of the risk management system will become increasingly relevant. This is facilitated by the changing working conditions of organizations and the objective needs of risk management entities and stakeholders. According to the authors, assessing the effectiveness of risk management systems allows you to obtain reliable information about the flow of business processes and identify problem blocks that impede the achievement of the organization's goals. Such information should be taken into account in the process of making managerial decisions at all levels of management.

Development of a set of priority measures for the integration of tools for assessing working conditions for the formation of occupational risk levels

Introduction. The increase in life expectancy, a decrease in mortality rates of the working-age population requires the development of a set of priority measures and justification of their effectiveness in the occupational risk management system based on the transition to a personalized assessment of working conditions and the health status of employees. The study aims to develop a set of priority measures to integrate tools for assessing working conditions and to justify their effectiveness in the occupational risk management system to determine the levels and groups of occupational risks in the workplace, depending on the complex of harmful and/or dangerous factors of the production environment and the labor process and the health status of employees. Materials and methods. The researchers have conducted the analysis of qualitative and quantitative indicators of occupational risk, including indicators of health disorders of employees. We have analyzed the materials of periodic medical examinations to substantiate the algorithm for the formation of risk groups for the development of occupational diseases. Scientists have performed a cross-epidemiological study to assess the risk of developing chronic general somatic diseases in workers. We have calculated the indicators of the total risk of fatal cardiovascular diseases. Experts have studied the features of the current situation with indicators of occupational morbidity in the Russian Federation. Results. There are two groups of qualitative and quantitative indicators at the level of state supervision and enterprise, which allow assessing the effectiveness of the risk management system. Scientists have identified qualitative and quantitative indicators for early detection of violations in the employee's body from the effects of production factors. We have substantiated the algorithm and criteria for the formation of risk groups for the development of occupational diseases. Assessment of the risk of developing general somatic diseases in workers with constant exposure to high levels of harmful factors: vibration, severity and labor intensity, showed a high prevalence and increased risk of diseases of the endocrine, musculoskeletal and circulatory systems, as well as a significant increase in these indicators with an increase in work experience in harmful working conditions, which allows us to consider these diseases as production-related diseases. Individuals with endocrine diseases are significantly more likely to have a very high, high and medium overall risk of developing fatal cardiovascular diseases (CVD). With an increase in work experience, the percentage of people at high risk of developing fatal CVD increased. The level of occupational morbidity calculated for the number of employees employed in harmful working conditions is 32% higher than the indicator calculated for all employees of the enterprise. A similar recalculation of occupational morbidity indicators for individual nosologies also completely changes the picture. Conclusion. We have substantiated the necessity of transition to a personalized assessment of occupational risk among employees. Researchers have developed proposals for adjusting legislation in order to integrate tools for assessing working conditions and improving the effectiveness of the occupational risk management system. Ethics. This study did not require the conclusion of the Ethics committee.

The effectiveness of risk management system and firm performance in the European context

PurposeThe purpose of this paper is to study the effectiveness of the risk management system in the European context, especially with regard to the risk management committee, the uncertainty of the environment and company performance. In summary, it evaluates European companies listed on the stock exchange in France, Germany and the United Kingdom to determine how risk management systems influence financial companies' performance.Design/methodology/approachTo study the effectiveness of risk management systems and their influence on performance, the large companies selected in our sample are fairly representative of the European market, according to the Dutch indices of each country (SBF 120 in France, HDAX 110 in Germany and FTSE 100 in United Kingdom).The empirical evidence is based on an international quantitative analysis, using a data set involving 320 companies listed on the stock exchange over a ten-year period from 2005 to 2014.FindingsThe results indicate that the establishment of a risk management and control system by a company positively influences its management, and its performance level and value creation also improve. The results of this study demonstrate a significant strengthening of the role of the risk management committee in the three countries. The surveillance function is reinforced, and in particular, the internal control system is accentuated.Research limitations/implicationsThis study has some limitations that can form leads for future research. One of these limitations is the sample size. The authors have represented the European context by three countries that certainly constitute great European powers, but have regulations different from other countries. The company size is also a possible research element. Indeed, risk management system varies between large, small and medium-sized enterprises, so it is important to study each type of company well.Originality/valueThis study identifies the risk management committee as a mechanism of control that is highly important in the company, and it proposes an international framework that comparatively and empirically evaluates how the risk management system used in large European companies can improve their financial performance.

Corporate Agreement in the Organization’s Risk Management System

The article examines the objectively existing need in modern market conditions to introduce and apply innovative approaches in the internal corporate management of commercial enterprises, including when building an effective risk management system. A brief assessment of the most widespread approach in Russia to the formation of local risk management systems is given. The article, using scientific methods of theoretical research, methods of scientific analysis and interdisciplinary synthesis (economics of law), methods of induction and deduction, generalization of the results obtained using a hypothetical-deductive method, substantiates the need for an effective local risk management system for Russian commercial enterprises. Arguments are given in favor of the use of innovative tools in the formation and filling of risk management systems. The article deals with the problems associated with the introduction of a corporate agreement as an effective tool in the system of minimizing commercial risks arising in the course of the activities of Russian business structures. The article presents the most relevant scientific publications on the topic of research and makes a generalized conclusion about the current state of research in the relevant field. The issue of the place of corporate agreements in local risk management systems is considered. The definitions are given and the main characteristics of risk management and its system, corporate agreement are given. The range of issues regulated by the provisions of the corporate agreement is outlined. The conclusion summarizes the arguments supporting the introduction of innovative tools into existing risk management systems. Arguments are given in favor of using a corporate agreement as an effective and low-budget tool to ensure the growth of the effectiveness of risk management systems in Russian business structures. The conclusion is substantiated that the use of a corporate agreement as an instrument of the risk management system is potentially capable of positively affecting the level of economic efficiency and competitiveness of commercial enterprises. Examples of corporate risks that can be minimized by applying certain provisions of the corporate agreement are given.

Risk Management Effectiveness of Oil And Gas Pipeline Construction in Java Island - Indonesia

One of the important oil and gas industry is oil and gas pipeline which serves to support the gas transmission and distribution process. The oil and gas pipeline routes are so long and cross through some areas that certainly raises the risk of adversely affecting the environment, especially for the pipeline located in a densely populated area, where at certain conditions, the pipe can leak and may cause the explosion. Many researches have been conducted concerning on the project pipeline risks which concluded that the oil and gas pipeline project has very complex risks. In addition, the oil and gas project may cause a potential disaster. Currently oil and gas companies have been implementing risk management to minimize the negative impacts, but the negative impacts are still occurred. This is due to ineffective risk management implementation. This study aims to analyze the effectiveness of risk management system for oil and gas pipeline project in Java Island. Based on a deep study literature review, it shows that the effectiveness of risk management can be achieved by taking account into environmental, social and economic factors that are the pillars of sustainable development system. The potential disaster was also to be considered as an addition factor. Therefore, four identified factors were analyzed using Analytical Hierarchy Process (AHP) method. Data were obtained using questionnaire which were distributed to oil and gas project team. It is found that the most factors to be considered was social aspect (40%) and the other factors contributed 31% for disaster, 15% for economic, 14% for environment. Those factors should be taken account in the design stage as the most priority.

A comparison of the original and revised Basel market risk frameworks for regulating bank capital

Recognizing that many banks suffered trading losses that notably exceeded their minimum capital requirements during the recent crisis, the Basel Committee on Banking Supervision (2011) revised its regulatory framework for trading portfolios. In this paper, we compare: (1) the relative effectiveness of risk management systems based on the original and revised frameworks in controlling tail risk; and (2) the relative adequacy of these frameworks in setting minimum capital requirements. Our main findings are as follows. First, both systems allow the selection of portfolios with substantive tail risk, but one based on the revised framework tends to be less effective in controlling tail risk. Second, the minimum capital requirements set by the revised framework are much less likely to be wiped out by trading losses than those set by the original framework. Hence, on balance, the revised framework improves upon the original framework. We also suggest further improvements for consideration by bank regulators.