The Impact of Risk Governance on Financial Stability: Rebuilding Financial Risk Management after the Financial Crisis
Author
Borsi, Pálma
Term
4. Term
Publication year
2016
Submitted on
2016-06-03
Pages
117
Abstract
This thesis examines how risk governance influences financial stability and how financial risk management can be rebuilt after the global financial crisis. It draws on a literature review of risk concepts, financial risk types, risk culture and risk appetite, and discusses Enterprise Risk Management (ERM) as a holistic, organization-wide framework. Methodologically, the study adopts a qualitative approach that combines secondary sources with primary data from expert interviews and a questionnaire, followed by descriptive analysis. Experts report that, prior to the crisis, risk management was often not integrated into decision-making, and weaknesses in governance, measurement, and oversight contributed to instability. The thesis argues for an indirect relationship whereby weaker risk governance increases the likelihood of financial distress and thus undermines stability, emphasizing that all components of risk governance collectively matter. It distills lessons learned from governance failures during the crisis and outlines high-level recommendations to strengthen sustainable, integrated ERM practices, while acknowledging the study’s limitations.
Dette speciale undersøger, hvordan governance af risikostyring (risk governance) påvirker finansiel stabilitet, og hvordan finansiel risikostyring kan genopbygges efter finanskrisen. Udgangspunktet er en litteraturgennemgang af begreber som risiko, typer af finansielle risici, risikokultur og risikovillighed samt en drøftelse af Enterprise Risk Management (ERM) som en holistisk ramme på tværs af forretningsenheder. Metodisk anvendes en kvalitativ tilgang, der kombinerer sekundære kilder med primære data i form af ekspertinterviews og et spørgeskema, efterfulgt af en beskrivende analyse. Eksperterne fremhæver, at risikostyring før krisen ofte ikke var integreret i beslutningsprocesser, og at svagheder i governance, måling og tilsyn bidrog til ustabilitet. Specialet argumenterer for en indirekte sammenhæng, hvor svag risk governance øger sandsynligheden for finansiel nød og dermed ustabilitet, og understreger at alle elementer i risikogovernance kollektivt er vigtige. På den baggrund præsenteres læringspunkter fra governance-fejl under krisen og overordnede anbefalinger for at styrke en bæredygtig, integreret ERM-praksis, samtidig med at specialets begrænsninger anerkendes.
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