Risk Management Standards Research Articles

МЕТОДИЧЕСКИЕ ОСНОВЫ УПРАВЛЕНИЯ ПРОЕКТНЫМИ РИСКАМИ

The article reveals the content of the concept of "project risks", provides the author's classification and a fairly detailed analysis of methods for studying and anticipating risks in project activities. It is noted that a decisive contribution to the development of project risk management standards is made by such international institutions as the Institute of Project Management and the National Institute of Standards and Technologies, according to the patterns of which the work of the relevant risk management standardization institutes in Russia is based. The authors argue that the existing scientific ideas about risk and the actual practice of design serve as a reason for making not only cautious and obviously feasible, but also daring and even adventurous, i.e. in principle questionable design decisions. It is also necessary to take into account that risks can arise at all stages of project development: initiative, planned, executive, control and final. Accordingly, it is advisable to build the overall risk management process within each of the five main phases of project activity. Using graphical models, the system-process and adaptive approaches to the study of external and internal risks of the project are substantiated. At the same time, special attention is paid to the description of risk scenario matrices (probable hazards) with simplified and more complex algorithms for calculating thresholds for the degree of probability of occurrence and severity of the consequences of risks. It is indicated that the level of professionalism in the field of modern project management is largely determined by the quality of development and the efficiency of using registers of project risks. The latter are considered as automated systems for making design decisions using tabular processors that systematize possible risks and their consequences in the implementation of specific projects.

ЗАРУБІЖНИЙ ДОСВІД ТА ВІТЧИЗНЯНА ПРАКТИКА ВИКОРИСТАННЯ ТА РЕГУЛЮВАННЯ ФІНАНСОВИХ ІНСТРУМЕНТІВ НЕБАНКІВСЬКИМИ ФІНАНСОВИМИ УСТАНОВАМИ В УКРАЇНІ

In the contemporary economic landscape, the non-banking financial services market has attained a significant prominence within the economies of developed countries. The primary objective is to examine the European experience, which will facilitate the selection of an appropriate model for the contemporary market of non-banking financial services and its instruments. The objective of this article is to examine the international experience of utilising and regulating financial instruments by non-bank financial institutions, with a view to assessing the feasibility of implementing this approach in Ukraine. A variety of scientific materials and individual methods were employed in the course of conducting the study. The abstract method was employed to analyze the professional literature on the subject, both domestic and foreign. To ascertain the potential for the advancement of financial instruments by non-bank financial institutions in Ukraine, the theoretical generalization and systematic methods were employed. The study's information base is comprised of official sources and data from recognized financial services market analysts. This article examines the experience of non-bank financial institutions in other countries. This study identifies the principal financial instruments and sources of financial resources for non-bank financial institutions in Ukraine. The regulatory and supervisory systems for financial institutions in Ukraine and abroad are examined, and the differences between them are identified. The primary challenges associated with regulating the activities of non-bank financial institutions in Ukraine have been identified. It has been concluded that the advancement of regulation and supervision in the Ukrainian financial market should be based on contemporary approaches and novel regulatory principles observed in European practice. This entails the unification of regulatory procedures, the implementation of risk-based supervision and the establishment of standardized risk management procedures, the reinforcement of control over the owners and managers of financial institutions, as well as the concentration and integration of regulatory functions within a single regulator. An additional crucial factor is the regulator's capacity and inclination to collaborate effectively with international financial institutions and their associations. The effective advancement of lending activities in the non-banking financial sector necessitates not only an enhancement in the level of borrower protection through the optimization of state regulation, but also an expansion in consumer financial awareness.

Success and Risks Related to Housing Projects in Pakistan: A Moderating Role of Project Management Risk Management

This study investigates the critical success factors (CSFs) and their interplay with project risks in determining the success of housing projects in Karachi, Pakistan, while considering the moderating role of risk management. Analyzing data from 432 project management professionals within Karachi-based housing societies, the study establishes significant relationships between CSFs and various project success dimensions, including time, cost, quality, project profile objectives, impact, stakeholder satisfaction, and preparation for the future. Additionally, the research reveals that project risks exert substantial influence on these success dimensions. Risk management is a strong moderator, increasing risk variable’s influence on project results. The findings provide insightful information for decision-makers, recommending the creation of sector-specific rules that place a strong emphasis on the highest standards in risk management and project execution. The construction industry benefits from this since it encourages long-term development and leads to better results for projects.

Failure Risk Analysis of SMEs based on ISO 31000

Higher competition makes Indonesian SMEs continue to improve their competitiveness, as it became the biggest driver of the national economy. The limitations of SMEs in the process of meeting customer demands are a major problem so that the risk of process failure accepted by SMEs is quite large. Therefore, this study aims to reduce the level of risk failure in SMEs to be able to increase success in meeting customer demand. The UKM used as a case study in this research is CV.Z, which is engaged in the fashion sector with made to order system. To reduce risk, the risk management process adopted adopts the approach of ISO 31000 as an international risk management standard. In the process of assessing the magnitude of the risk, the Failure Mode Effect Analysis (FMEA) technique was used in this study. The result is that as many as 38 failure modes were identified in the production process, with the highest Risk Priority Number (RPN) value 162. Corrective action was taken in the largest RPN failure mode by applying new methods and providing training to workers. It is expected that implementing corrective actions can reduce the failure rate in the process in SMEs.

Analyze the Efficiency of Banking Risk Management in Banks Operating in The Local Environment Through the Application of Basel Standards in Financial Risk Management

This article discusses the challenges facing the banking system in light of the development of the banking industry and the increase in banking competition at the local and global levels. The article notes that banking risks are no longer limited to credit risks, but also include market risks, liquidity, interest rates, operational risks and others. Based on this development, it has become necessary for banking regulators and institutions to apply unified standards for managing these risks in order to protect the financial stability of banks and the financial system. The article highlights the role of the Basel Committee on Banking Supervision in setting these standards and motivating banks to implement them to ensure the safety of banking systems. The article also notes the importance of bank risk management to enhance the sustainability of banks and avoid the negative effects of risks. The research aims to review the concepts of banking risks and their importance, identify strategies to deal with them, and the extent to which banks comply with the requirements of the Basel Committee. The research shows hypotheses such as the importance of properly managing banking risks for the success of banks and achieving their goals, and the difficulty of applying Basel requirements in the banking environment. The study is chronologically limited to the period from 2014 to 2018, and spatially limited to analyzing the reports of the Rafidain bank in Iraq during that period.

FEATURES OF RISK DETERMINATION AND CONTROL OF THE UNDERGROUND FACILITIES STABILITY LOSS UNDER CONDITIONS OF ROCKS PROPERTIES VARIATION

Problem statement. Modern geotechnical production or an underground structure used as a military-industrial facility must meet the requirements of international risk management standards, which form the basis of safe and effective management. Implementation of effective risk management improves the quality of decision making, and has a positive impact on the benefit of the enterprises and society as a whole. The purpose of the article. To improve the method of risks’ determining for the mining stability loss and other underground structures, taking into acount the variability of the physical and mechanical properties of rocks. Methods. The use of a systematic approach in analytical studies of literary sources, systematization of modern approaches and methods in determining risks in the life safety system, processing by statistical methods, and the use of probability theory. Research results. Based on the results of field studies of the underground mining of the Yubileynaya mine at the Pershotravenskoye Mining Structural Division of PuAT DTEK Pavlogradugol, graphs of roof deformations were constructed, displacements were determined, dependencies were obtained, and the risks of underground mining destruction were identified. Scientific novelty. For the first time, the use of the parameters’ scatter by their standard deviation in identifying the risk of stability loss for underground mining is proposed. Practical value. A methodology for identifying and predicting geomechanical parameters for a risk-oriented system for monitoring the stability of the rock mass while ensuring safety when using developments as military-industrial complexes is proposed.

Optimizing Hajj Fund Management through Strategic Asset Allocation in Islamic Finance Instrument

The management of Hajj funds must be done effectively using a rigorous standardized risk management approach. This study aims to create a Hajj fund management model using Islamic financial instruments through the optimal portfolio method and strategic asset allocation. The model was built using historical data from 2010–2022, involving Islamic deposits, government sukuk (SBSN), corporate sukuk, and Islamic stocks, which were analyzed with the Markowitz portfolio equation in Excel Solver. The result showed that the optimal portfolio yields an 8.50% expected return with a 4.00% risk; strategic asset allocation produces an 8.25% return with a 2.99% risk. The policy implication of this research is the need to review the initial deposit of pilgrims and explore alternative investments to bridge the gap between the actual cost of Hajj and pilgrims' payments while improving returns.JEL Classification: M31, M37, L92 How to Cite:Masruroh, A., Rodoni, A., & Pontjowinoto, I. P. (2023). Optimizing Hajj Fund Management through Islamic Finance Instrument. Signifikan: Jurnal Ilmu Ekonomi, 12(2), 287-306. https://doi.org/10.15408/sjie.v12i2.34403.

IMPLEMENTATION OF RISK MANAGEMENT IN SOLID WASTE MANAGEMENT (SWM) TO ENHANCE THE QUALITY OF LIFE (A CASE STUDY OF PT. ARTA ASIA PUTRA)

Effective solid waste management (SWM) is crucial for maintaining environmental sustainability and enhancing the quality of life in communities. However, improper waste management practices pose significant risks to public health, the environment, and social well-being. This study discusses implementing risk management strategies in SWM, focusing on the case of PT. Arta Asia Putra.org is a waste management initiative in a densely populated Malang, East Java urban area. By analysing the organisation’s risk assessment, mitigation measures, and community engagement, this research sheds light on the significance of integrating risk management principles to ensure a safer and healthier living environment. The results show that, while the company does try to effectively manage the risks inherent in its operations by providing safety kits and health insurance for employees working at the dumpsites, several significant challenges persist. These challenges include the absence of established risk management standards within the company, employee non-compliance with safety measures, and the lower educational levels of the workforce. These factors collectively hinder the company's ability to mitigate the risks associated with its operations entirely. To solve the said challenges, the study suggests that there should be comprehensive risk management standards, regular employee training awareness, and incentives for compliance to encourage employees to comply with safety measures

ПРОЦЕС УПРАВЛІННЯ РИЗИКАМИ В ІТ-ПРОЄКТАХ

The purpose of the article is to study the process of project risk management and develop recommendations for its adaptation for IT projects. In the sphere of project management in the formation of project risk management process most often relies on international standards. The article presents an overview of the process of project risk management according to the standards: Project Management Body of Knowledge (PMBOK), International Organisation for Standardisation (ISO); Projects in Controlled Environments (PRINCE2). It is determined that the presented standards are sufficiently structured and can be applied to risk management in various projects, including those in the field of information technologies. The peculiarities of the risk management process in IT projects in accordance with the Microsoft Solutions Framework methodology are disclosed. It focuses on the formation of risk management process in projects in accordance with the Risk Management Maturity Model; Capability Maturity Model Integration (CMI); Maturity Level of Risk Management in IT Projects. IT projects have specific characteristics, and market competition, customer requirements, rapid development of technologies, team qualification – all this requires adaptability to the formation of the risk management process. When forming a risk management process in IT projects, especially in IT startup projects, the choice of a standard, methodology, or a combination of them (individual sections) should take into account the specifics of the project, project team, management, corporate culture, segment and market conditions, stakeholders, qualification of specialists engaged in risk management. In order to improve the effectiveness of risk management in IT projects, it is recommended that IT companies create structural and infra-red elements of risk management, namely: to attract risk management specialists; to develop job descriptions that define their functional duties and responsibilities; to develop corporate standards for risk management.

Risk Management Culture, Structure, and Process – Theoretical Insights and Empirical Evidence

In the contemporary business environment, companies face a wide range of risks that necessitate effective risk management strategies. Risk management can be approached through either a traditional or integrated concept, which hinges on a company's ability to avoid, reduce, and transform risks into opportunities.
 
 This research aims to investigate the risk management practices employed by joint-stock companies in Bosnia and Herzegovina. The study will focus on evaluating the risk management culture, structure, and processes implemented by these companies.
 
 The research was conducted using a questionnaire distributed to a sample of 141 companies listed on two stock exchanges in B&H. The survey included 31 identified risk management components related to culture, processes, and organizational structure. To enhance accuracy, the survey responses were improved using a Likert scale, replacing the previous "Yes – No" dummy approach. Before administering the survey, all components were validated by a group of experts. The findings revealed that companies in Bosnia and Herzegovina (B&H) have inadequately developed components of an integrated risk management concept.
 
 The research results suggest that B&H companies primarily rely on traditional risk management approaches, failing to keep up with the global trend of implementing risk management standards. This situation may lead to adverse implications for BH companies and its economy.

Extending and improving current frameworks for risk management and decision-making: A new approach for incorporating dynamic aspects of risk and uncertainty

In recent decades, there has been a growing recognition of the importance of risk-informed decision-making, and the use of risk assessments to support decisions is a core principle in current frameworks and standards for risk management and decision-making. While considerable efforts have been directed towards clarifying the role of risk assessment as input to decision-making, less attention has been paid to the follow-up of the risk assessment once a decision has been made. However, new knowledge, as well as changes in systems, phenomena or values, could alter the underlying premises of the initial risk assessment. Many of the current frameworks for risk management and decision-making lack suitable approaches for reflecting these issues, leaving important aspects of risk unaddressed. In this paper, we present an adjusted approach to risk management and decision-making in which the need for new risk assessments is evaluated, focusing on three main criteria: i) the introduction of new decision alternatives, ii) changes in risk, and iii) changes in context/values. Acknowledging the challenge of determining the appropriate timing for the evaluation, we emphasize that striking a balance between remaining responsive to challenging circumstances and avoiding the use of unnecessary resources on excessive evaluations, is a key task. By providing the basis for a more dynamic approach to risk assessment and risk management, the paper aims to strengthen the foundation for risk-informed decision-making.

ENTERPRISE RISK MANAGEMENT DISCLOSURE AND CEO CHARACTERISTICS: AN EMPIRICAL STUDY OF GO PUBLIC COMPANIES IN INDONESIA

Organizations can use enterprise risk management disclosures to share financial and non-financial risk information with external stakeholders. Chief Executive Officer (CEO) has a key role in enterprise risk management. This study examines the relationship between Indonesian CEOs’ characteristics and enterprise risk management disclosure. Purposive sampling is the basis for the process of gathering samples from the population. The research was conducted in 2020 and consisted of 475 non-financial Indonesian companies that were listed on the Indonesian Stock Exchange. The findings of previously released annual reports may be found on the websites of both the Indonesia Stock Exchange and individual companies. These secondary sources were used to compile the study data. The ISO framework index 31000:2018 is utilized to evaluate the Enterprise risk management (ERM) disclosure. Eviews10’s implementation of multiple regression serves as the basis for the analysis. The findings indicate that CEO overconfidence and CEO tenure influence enterprise risk management disclosure, while CEO financial expertise and CEO gender did not have an effect on enterprise risk management disclosure. The innovation of this research is investigating CEOs’ characteristics by psychological characteristics, namely CEO overconfidence and measurement of ERM disclosure based on the ISO 31000:2018 framework which is the latest standard of risk management.

The Current State of Scientific Research of the Process of Risk Management of Ukrainian Energy Sector Enterprises

Abstract The research dedicated to risk management issues in the energy sector addresses current problems associated with risk management that arise in the energy sector. The aim of the study was to identify factors that affect risks, analyze scientific risk management methods, and consider innovative approaches to risk management in the energy sector. The study used a critical analysis of the literature on the subject as well as an analysis of risk management standards and methods. The innovation of the research lies in its consideration of modern trends in risk management in the energy sector, taking into account changing economic and political conditions, technical possibilities, as well as social attitudes and demands. The study showed that the most effective approach to risk management in the energy sector is the use of an integrated risk management system that takes into account all aspects of enterprise activity. The results of the study can be useful for energy companies that deal with risk management. They can be used to improve risk management strategies and reduce the possibility of negative consequences. In addition, this research can be used for educational purposes for students and professors who study risk management and the energy sector. The next steps of the research may include expanding the scope of the study to other areas and developing more detailed risk management models.

A framework for assessing hazards related to pit lakes: application on European case studies

The number of abandoned mines is continuously increasing in the world. The sustainable exploitation of these abandoned mines is a top priority globally. Pit lakes created in abandoned mining sites provide benefits and present risks for the mining region. This paper presents a methodology to assess the mining and natural hazards related to pit lakes. The proposed methodology framework is based on well-established and internationally accepted risk management standards and allows the assessment of the long-term stability of pit lakes. Potential ground movements, water pollution, fire hazards are presented, and their impact evaluated based on feedback and international experience. The methodology was applied for 13 European pit lakes created in former European coal and lignite mines. A risk assessment of the Most lake was carried out, using qualitative and a weighted probabilistic approach that considers the overall and the individual effect of identified mining and natural hazards. Results showed that the main potential hazards are the ground movements, slope stability, and flooding.

Equity Financing and Performance of Islamic Commercial Banks in Kuala Lumpur, Malaysia

Equity financing plays a crucial role in the performance of banks by providing a stable and reliable source of capital. With equity financing, banks can strengthen their balance sheets, improve their capital adequacy ratios, and enhance their ability to absorb financial shocks. By issuing new shares or raising equity capital from investors, banks can expand their lending activities, invest in technology and infrastructure, and pursue growth opportunities. Moreover, a higher equity base can increase investor confidence and improve credit ratings, enabling banks to access funding at lower costs. A well-capitalized bank through equity financing is better positioned to navigate economic downturns, mitigate risks, and sustain long-term performance. The study used the descriptive research design. The target population was 20 branches of Islamic commercial banks in Kuala Lumpur, Malaysia. The study did sampling of 15 participants that were chosen from the target population of 20 branches of Islamic commercial banks in Kuala Lumpur, Malaysia. Questionnaires were used to collect the data. It was concluded that equity financing enables investors and the bank to share risks and rewards, and understanding how this affects the risk profile, stability, and profitability of Islamic banks is essential. Identifying areas for improvement and growth in the Islamic banking sector will require ongoing evaluation of the impact of equity financing on various performance indicators, including profitability, risk management, and asset quality. The study recommended that Islamic commercial banks in Kuala Lumpur should focus on strengthening their risk management frameworks to effectively manage the risks associated with equity financing. There should be implementation of robust risk assessment and monitoring systems, conducting thorough due diligence on potential shareholders, and diversifying their equity base to minimize concentration risk. Regulatory frameworks should address issues such as corporate governance, disclosure requirements, and risk management standards to promote transparency, investor confidence, and the overall performance of Islamic commercial banks in Kuala Lumpur. Keywords: Equity financing, performance, Islamic commercial banks, Malaysia

Capacity Building for Organizational Resilience: Integrating Standards on Risk, Disruption and Continuity in the Curriculum

Disruption is an inevitable factor in business and society, while inability to mitigate and manage risk can cause irreparable damage to business, the economy, and our ways of life. The COVID-19 pandemic has heightened interest in standards-based strategies for risk management and crisis preparedness to enhance organizational and societal resilience. University curricula that integrate national and international standards offer students a rich skill-set for effective performance in their careers. Moving forward, we must cultivate capable professionals who understand the challenges and risks facing society, and who grasp standards and systems for strategic planning, response, and recovery to promote organizational resilience and sustainable development. This paper focuses on the effectiveness of integrating risk management and continuity standards into university curricula, based on implementation at a large private university and regional community college in the Northeastern United States. We propose and evaluate a modular approach to introduce students to specific national and international standards, and teach them to identify and apply relevant standards based on the locally driven, whole community nature of disaster preparedness, response, and recovery. Education using standards-based curriculum and the competencies that result will be key to readiness for tomorrow’s graduates.

Integrated security management model: a proposal applied to organisational resilience

The purpose of this article is to contribute scientifically to the thematic areas of organisational resilience and security risk management by providing a model of a flexible security management system that can be integrated with other management systems and be applied to the operational dimension of organisational resilience. To this end, the literature on security risk and operational resilience has been reviewed, as well as on security governance models based on enterprise security risk management and other international standards that allow integration with business processes. During the study, an incipient production of specific models that determine the maturity of different management systems was observed in the academic sphere, with a gap being detected in terms of security management system maturity models linked to organisational governance and enterprise risk management, which would facilitate their inclusion in the organisation's integrated management system in a practical way. It is concluded that the proposed model provides scientific support to practitioners, and, to a greater extent, to companies and other organisations irrespective of their size, sector of activity or location.

SARS-CoV-2 transmission among healthcare workers and related potential stigma during COVID-19 pandemic

A limited number of studies are available on COVID-19 patients by disease cluster. We aimed to evaluate the healthcare cluster and stigmatization during the COVID-19 outbreak in Batam, Indonesia. A qualitative study using an empirical phenomenological approach and in-depth interviews with content and thematic analysis was conducted. The informants admitted that they were infected with the severe acute respiratory syndrome coronavirus 2 (SAR-CoV-2) virus due to non-compliance to COVID-19 protocols, such as removing masks and talking face to face during breaks in meetings held in poor-ventilated rooms. A social stigma was experienced by these healthcare workers because people tended to keep their distance and ostracized them because they were afraid of COVID-19. Healthcare workers tend to be stigmatized and ostracized by the community. A clinical guideline and public health policy should be established by involving community leaders to minimize the psychological pressure experienced by healthcare workers. The results of this study can help policy makers to improve risk management standards in controlling the spread of the SARS-CoV-2 virus in health center to create publich health trust in eliminating COVID-19.

A Case of Risk Management Control and Its Study in Non-Financial Risks

The objective of the research work was to establish the context of non-financial risks in the company Brad of Wales, and it is recommended that they be managed as soon as possible, considering the low level of maturity of this international company. The applied paradigm was qualitative, the research method was descriptive, and the research tools were case studies. It was able to be carried out due to the adversities suffered in the company studied due to the pandemic and that generated risks that must be managed, adding to this new risks such as climate change, sustainability and social responsibility of the entity. Among the most important findings of this work, it was detected through an internal control survey with a focus on risks; a low level of maturity, explained by low risk assessment. In addition, the compliance risk showed a high level of criticality because basic risk management standards for any organization are not being considered by the regional corporate governance. And, therefore, a great opportunity was evidenced, not only at the local level, but also at the corporate level, for the application of the best practices around corporate risk management.

Surgical plume and its associated hazards to perioperative staff: A review of current standards for practice and risk management

Surgical plume poses a risk to perioperative nurses and the perioperative team as a whole, as well as the operative patient. Surgical plume contains various hazardous components which pose multiple health risks to the perioperative staff who are exposed to it. Further research is required in order to definitively understand the risks to perioperative staff from long-term exposure to surgical plume and to advance current policies and procedures. The current practice standard on surgical plume management from the Australian College of Perioperative Nurses (ACORN) sets out methods of reducing these risks. However, this standard’s utility in practice and barriers to its implementation lead to ongoing unnecessary plume exposure. Through adhering to current practice standards and educating perioperative nurses, the risks posed by surgical plume can be mitigated. Thorough education on this topic will empower nurses to advocate for their safety and the safety of their patients, leading to the reduction of surgical plume exposure.