Risk Management Practices: The Ghanaian Firms’ Perspective
This paper examines the risk management practices from the Ghanaian firms’ perspective. The research adopted a modified methodology of Al-Tamimi and Al-Mazrooei (2007). A questionnaire was developed on the following: (1) understanding risk and risk management, (2) risk identification, (3) risk assessment and methods employed in managing risks (4) implementation of risk management methods, (5) risk monitoring and (6) future prospect of risk management. Using a quantitative approach the findings of the study are that Ghanaian firms understand risk and risk management. Additionally, operational, liquidity and credit risk are the most dominant risks experienced while risk identification and selection jointly determine risk management practices in Ghana. Based on the findings the study recommends that supervisors should place particular emphasis on two issues: (1) Understanding the differences in types of risks and how firms may be assessing those risks that are traditionally non-existing or less common in their sector than in other sectors, and (2) understanding the methodologies that firms are developing to provide a consolidated firm-wide view of risk that spans multiple risk categories.
Keywords: Risk management, Risk, Operational risk