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Agriculture is one of the sectors most exposed to a plethora of risky phenomena such as weather, pests and diseases, changes in prices and government policies, instability of global markets. We review the literature on risk management (RM) in agriculture focusing on five key issues: i) why evidence on RM is often controversial; ii) how farmers behave in selecting among available RM instruments; iii) why some of these instruments are underutilised; iv) how to assess the impacts of innovative RM tools to (further) improve their design; v) how agricultural policy measures aimed at increasing the environmental sustainability of the sector could affect RM choices. We address all these issues to get a holistic vision of RM, and point at areas where further analyses are needed.

The past 25 years have witnessed unprecedented changes around the world—many of them for the better. Across the continents, many countries have embarked on a path of international integration, economic reform, technological modernization, and democratic participation. As a result, economies that had been stagnant for decades are growing, people whose families had suffered deprivation for generations are escaping poverty, and hundreds of millions are enjoying the benefits of improved living standards and scientific and cultural sharing across nations. As the world changes, a host of opportunities arise constantly. With them, however, appear old and new risks, from the possibility of job loss and disease to the potential for social unrest and environmental damage. If ignored, these risks can turn into crises that reverse hard-won gains and endanger the social and economic reforms that produced these gains. The World Development Report 2014 (WDR 2014), Risk and Opportunity: Managing Risk for Development, contends that the solution is not to reject change in order to avoid risk but to prepare for the opportunities and risks that change entails. Managing risks responsibly and effectively has the potential to bring about security and a means of progress for people in developing countries and beyond. Although individuals' own efforts, initiative, and responsibility are essential for managing risk, their success will be limited without a supportive social environment—especially when risks are large or systemic in nature. The WDR 2014 argues that people can successfully confront risks that are beyond their means by sharing their risk management with others. This can be done through naturally occurring social and economic systems that enable people to overcome the obstacles that individuals and groups face, including lack of resources and information, cognitive and behavioral failures, missing markets and public goods, and social externalities and exclusion. These systems—from the household and the community to the state and the international community—have the potential to support people's risk management in different yet complementary ways. The Report focuses on some of the most pressing questions policy makers are asking. What role should the state take in helping people manage risks? When should this role consist of direct interventions, and when should it consist of providing an enabling environment? How can governments improve their own risk management, and what happens when they fail or lack capacity, as in many fragile and conflict-affected states? Through what mechanisms can risk management be mainstreamed into the development agenda? And how can collective action failures to manage systemic risks be addressed, especially those with irreversible consequences? The WDR 2014 provides policy makers with insights and recommendations to address these difficult questions. It should serve to guide the dialogue, operations, and contributions from key development actors—from civil society and national governments to the donor community and international development organizations.

This study proposes a trapezoidal interval type-2 fuzzy TOPSIS method to evaluate agricultural risk management tools. The weighted centroids based on AHP is used in the proposed method to defuzzify the fuzzy weighted ratings of each alternative versus each criterion. By this way, this method considers all centroid values of the upper and lower membership functions and uses the weight as a parameter to consider the relative importance of controid values of the upper and lower membership functions. Additionally, the left and the right upper membership function and lower membership function of the multiplication of two positive trapezoidal IT2FNs can be developed based on the α-cuts. The proposed method is applied to help farmers compare agricultural risk management tools and select the most suitable one. This is the first study using fuzzy decision-making methods to help farmers evaluate agricultural risk management tools. To show the proposed method’s feasibility, a numerical example is displayed. Finally, some comparisons are made to show the advantages of the proposed method, and an experiment is conducted to show the robustness of the proposed method.

Risk management is an essential way for farmers to reduce uncertainty. In this research, a stratified random sampling method was used to survey 350 maize farmers in four different agro-ecological regions in Bangladesh. Using the multivariate probit model, this study explored the possible correlation between farmers’ perceptions of catastrophic risks and their attitudes towards risk sources—as well as the possible correlation between contract farming, diversification and precautionary savings as risk management strategies. The results confirm the relevance of risk management adoption decisions and reveal that the use of one risk management tool may simultaneously influence the use of another risk management tool. In addition, the research results also show that age, education level, extension experience, monthly household income, farming areas, land ownership and risk aversion nature are the most important factors that affect the adoption of risk management strategies. The research results provide further explanation and information and provide a platform for decision-makers to predict appropriate risk management strategies.

Purpose – The competition and challenges facing construction firms during the recent recession have brought risk management (RM) to the fore in people’s minds. Examination of the difficulties of implementing RM in small and medium enterprises (SMEs) in the UK construction industry has been relatively untouched. The paper aims to discuss these issues. Design/methodology/approach – As part of on-going research to facilitate RM processing aimed at improving the competitiveness of SMEs, the difficulties in RM implementation were identified through a literature review of RM implementation in SMEs. Postal questionnaire were sent to SMEs who have experience of construction management. Findings – Of the 153 of SMEs responding, most highlighted that the main difficulty experienced is how to scale RM process to meet their requirements. None of the available standards explain the fundamental principle of applying RM to the situations that SMEs find themselves in. This difficulty is further exacerbated by a lack of management skills and knowledge in the adoption of RM tools or techniques to identify and analyse the business’ risks. Originality/value – The identified difficulties can be considered to develop a process to facilitate RM process within SMEs.

PurposeThe authors investigate whether firms can ensure their financial stability during the coronavirus disease 2019 (COVID-19) pandemic by having ex-ante risk management.Design/methodology/approachThe authors study 279 Vietnamese listed firms by investigating their disclosure of risk awareness and risk management tool(s) in the 2019 annual reports. The authors then examine whether prior risk awareness and adoption of risk management tool(s) can enhance the firms' financial ratios during the COVID-19 pandemic.FindingsThe authors find that firms that disclose their risk management tool(s) in the 2019 annual reports have better asset utilization and higher liquidity during the COVID-19 pandemic than the others. However, firms that simply express their risk awareness exert no stronger financial stability. In addition, the authors document that debt management is the most popular and most effective tool to ensure firms' financial stability during the crisis.Originality/valueThe study highlights the need for ex-ante risk management for future pandemics. The authors also suggest that stakeholders can rely on the degree of risk management tool utilization to evaluate the financial stability of firms.

The study aims to examine the enterprise risk management (ERM) practices of Ethiopian commercial banks. This approach is undertaken to examine the current approach to enterprise risk management within the Ethiopian banking context. A mixed-methods research design is employed which comprises content analysis and a survey study. The study found that the prevailing emphasis of risk management functions in Ethiopian commercial banks revolves on ensuring compliance with regulatory reporting standards. A significant number of the banks have implemented ERM programs primarily to meet regulatory obligations, rather than leveraging ERM to generate firm value. The study identified several gaps in the risk management function of Ethiopian commercial banks, including lack of integration of risk management with the banks’ mission and core values, failure to assess the resources required for effective risk management and to prioritise resource allocation accordingly, inadequate coverage of relevant activities and functional areas by both risk management and internal audit activities, and limitations on the assignment of chief risk officers (CROs) to oversee the risk management function within the banks. Overall, the maturity level of ERM implementation among Ethiopian commercial banks is moderate and requires further enhancement.

This article describes how as mankind has been ever-evolving, so are their needs, growing in leaps and bounds. Risk management in supply chains have become a prerequisite as it involves a series of steps like procuring, processing, and distribution, where risk has to be managed. Given the advent of technology and transformation of supply chain management from traditional to modern methods, a lot has changed, and of course with ever-evolving technology, the organisations have become adept at handling risks associated with many factors within the organisation and outside the organisation. In this article, the authors will analyse the percentage impact of external and internal supply chain risk factors on various supply chain decisions, and also project various tools available to mitigate Supply chain risks.

In the context of the dynamics of the modern external environment, the importance of risk management in general and the risks inherent in the processes of mergers and acquisitions has sharply increased. This is becoming one of the primary challenges in business, the solution of which will contribute to economic growth and development. In this article, based on a broad review of literature, the key risks of mergers and acquisitions are identified and classified, the level of their significance is assessed, the relevant management tools are selected for each risk and a computer program is developed that implements the selection of tools for each specific merger and acquisition transaction. A comprehensive automated methodology for the selection of risk management tools in the implementation of mergers and acquisitions can become an effective risk management tool for companies participating in such transactions. This will allow to identify and track risks in a timely manner, assess their significance, and, among other things, contribute to the adoption of effective management decisions regarding risk management.

The purpose of the study is to develop the theory of hedging, generalize approaches to the formation of effective risk hedging strategies, and provide recommendations for the implementation of international banks' experience in Ukrainian practice. It is proved that in the process of choosing effective strategies, it is advisable to distinguish three types of financial risk hedging: a) operational hedging (balance sheet) to ensure operational flexibility; b) market hedging (external), which involves the use of derivatives as instruments to hedge profit volatility; c) contract hedging (contractual clauses, embedded derivatives. Based on the analysis of the reports of 250 banks, it was found that Bank of America, JPMorgan Chase & Co., Goldman Sachs, Morgan Stanley, and Citigroup are the market makers in the most developed US futures market. Horizontal analysis of the balance sheets of these banks showed that although the share of derivatives designated as hedging instruments is insignificant (less than 1%) relative to term contracts recognized as trading instruments, the hedging effect is significantly higher than the gains on the trading portfolio. It was found that in international practice, the dominant direction is the hedging of interest rate risk (the share of which varies between banks from 42.52% to 61.26%), in the structure of hedging instruments, interest rate swaps prevail. The share of currency derivatives varies from 18.67% to 41.45%. Interest rate risk is hedged by over-the-counter bilateral term contracts for active operations, currency risk hedging equally covers the risks of passive and active operations. The regression analysis revealed that private credit and trading assets have an inverse effect on regional hedging exposure, and debt instruments have a direct effect. The study provides a basis for assessing the potential of using innovative risk-hedging instruments by Ukrainian banks.