Risk management strategies. Since the consequences of risks may threaten the survival of the enterprise, it is important for the enterprise to adopt appropriate risk management strategies for risk management. What are the risk management strategies? Let’s take a look. What are the risk management strategies? Part 1

What are the risk management strategies?

　(1) Risk avoidance strategies.

Any economic unit’s strategy for dealing with risks should first consider avoiding risks. When the losses caused by risks cannot be offset by the profits that may be obtained from the project, avoiding risks is the most feasible and simple method. For example, by not making a certain investment, you can avoid the risks associated with that investment. However, the method of avoiding risks has great limitations. First, avoiding risks is effective only when the risks can be avoided; second, some risks cannot be avoided; third, some risks may be avoided but the cost is too high; fourth, the enterprise Passively avoiding risks will make enterprises content with the status quo and not seeking progress.

(2) Risk control strategy.

When an economic unit cannot avoid risks or is bound to face certain risks when engaging in certain economic activities, the first thing that comes to mind is how to control the occurrence of risks, reduce the occurrence of risks, or how to reduce the losses caused by the occurrence of risks. , which is to control risks. Controlling risks mainly has two meanings: one is to control risk factors and reduce the occurrence of risks; the other is to control the frequency of risk occurrence and reduce the degree of risk damage. To control the frequency of risk occurrences, we must make accurate predictions, and to reduce the degree of risk damage, we must take effective measures decisively. Risk control is subject to various conditions. Although human knowledge and technology have been highly developed, there are still many difficulties that cannot be overcome. Therefore, it is impossible to completely control risks and fully reduce losses.

(3) Risk diversification and neutralization strategies.

Risk diversification mainly refers to the ways in which economic units adopt multi-faceted operations, multi-party investments, multi-party financing, diversified sources of foreign exchange assets, attract multiple suppliers, and win over multiple customers to spread risks. Neutralizing risks mainly refers to the decisions adopted in foreign exchange risk management, such as taking measures such as reducing foreign exchange positions, futures hedging, and forward foreign exchange business to neutralize risks.

(4) Risk-taking strategy.

When an economic unit can neither avoid risks nor completely control risks or diversify or neutralize risks, it can only bear the losses caused by the risks itself. The way in which economic units bear risks can be divided into unplanned simple retention or planned self-insurance. Unplanned simple retention mainly refers to the way of bearing losses caused by unforeseen risks; planned self-insurance refers to the way of bearing losses caused by predicted risks, such as the withdrawal of bad debt reserves.

(5) Risk transfer strategy.

In order to avoid hindrance and disadvantage to its economic activities after taking on risks, economic units can adopt various transfer methods for risks, such as insurance or non-insurance transfer. Modern insurance systems are the most ideal way to transfer risk. For example, the unit carries out property and medical insurance and transfers risk losses to the insurance company. In addition, the unit can also transfer part of the risk to the other party through contract terms.

About five strategies of project risk management

1. Risk mitigation strategy

Risk mitigation strategy is to mitigate risks and reduce risks through means such as mitigation or prediction. The possibility of occurrence or the adverse consequences of mitigating risks to achieve the purpose of risk reduction. This is a proactive approach to risk management.

2. Risk avoidance strategy

It refers to actively abandoning the project when the possibility of potential threats to project risks is too great, the adverse consequences are too serious, and no other risk management strategies are available. Or a risk management strategy (risk control network) that changes project goals and action plans to avoid risks. For example, an enterprise is currently facing an investment project with immature technology. If it is discovered through risk assessment that the implementation of the project will face a huge threat, the project management organization has no other available measures to control the risk, and even the insurance company believes that the risk is too high. Big denial of coverage. At this time, you should consider giving up the implementation of the project to avoid huge risks, accidents and property losses.

3. Risk acceptance strategy

Risk acceptance strategy is also one of the risk management strategies. It refers to the strategy in which the project team consciously chooses to bear the consequences of risks. When the cost of adopting other risk avoidance methods exceeds the losses caused by risk events, the risk acceptance method can be adopted. Risk acceptance can be proactive, that is, some risks have been prepared during the risk planning stage, so when a risk event occurs, the contingency plan will be implemented immediately; risk acceptance passively means that the project management team is not aware of the existence of risks due to subjective or objective reasons. There is insufficient understanding of the seriousness of the project and the failure to deal with the risks, and ultimately the project management organization personnel bear the risk losses themselves. When implementing a project, you should try to avoid passively accepting risks. Only by making preparations in the risk planning stage can you actively accept risks.

4. Reserve risk strategy

The reserve risk strategy refers to formulating emergency measures in advance and formulating a scientific and efficient project risk plan according to the project risk rules. Once the actual progress of the project is different from the plan, , regarding the use of backup emergency measures, there are three main types of project risk emergency measures: cost, schedule and technology. A budget contingency is a sum of money set aside in advance to compensate for the impact of errors, omissions, and other uncertainties on the accuracy of project cost estimates. Budget contingency expenses should be listed separately in the project budget and cannot be dispersed under specific expense items. Otherwise, the project management organization will lose control of expenditures.

5. Risk transfer strategy

It refers to transferring risks to other people or other organizations. Its purpose is to use contracts or agreements to transfer part of the losses when a risk accident occurs. To individuals or organizations that have the ability to withstand or control project risks. When implemented, it can be manifested as financial risk transfer (for example, banks, insurance companies or other non-bank financial institutions bear indirect responsibility for project risks). Non-financial risk transfer (transferring project-related properties or projects to a third party, or transferring risks to other people or organizations in the form of a contract, while also retaining the properties or projects that generate risks).

The success of the project is related to the future development of the enterprise. Enterprises should increase risk management in project investment and try to minimize failures, so as to enhance the competitiveness of the enterprise and make the enterprise invincible. Land, long-term development. The ultimate purpose of risk management strategy is to take measures against risk-related factors to avoid risks, resolve and transfer risks, or to weigh the pros and cons and reduce the impact of risk losses.

Seven basic strategies for risk response

1. Risk taking

Risk taking is the risk within the risk tolerance of the enterprise. After weighing the cost-benefit, There is no strategy to take control measures to reduce risks or mitigate losses.

The group or subsidiary adopts a risk-bearing strategy, either because it is a more economical strategy or because there are no other alternatives (such as reducing, avoiding or sharing). When using risk tolerance, management needs to consider all options, that is, if there are no other alternatives, management needs to make sure that all possible avoidance, reduction or allocation methods have been analyzed to decide to accept the risk.

In the process of considering risk responses, management needs to evaluate the costs of various risk control measures and the benefits brought by reducing the likelihood and impact of risks, and choose a risk response strategy .

2. Risk avoidance

Risk avoidance is a strategy for enterprises to avoid and mitigate losses by giving up or stopping business activities related to the risk for risks that exceed their risk tolerance.

The purpose of risk aversion is to resolve risks when adverse consequences are expected. For example, a group may consider that the risk of an investment project is very likely to occur but cannot bear it and cannot take measures to reduce it. The group may choose to withdraw from the investment project or order its subsidiaries to withdraw from the investment project to avoid risks.

3. Risk transfer

Risk transfer is a risk management strategy in which an enterprise transfers risks to another person or unit through contractual or non-contractual means.

Generally speaking, risk transfer methods can be divided into financial non-insurance transfer and financial insurance transfer.

Financial non-insurance transfer refers to the transfer of risks and risk-related financial results to others through the conclusion of economic contracts.

Common financial non-insurance risk transfers include leasing, mutual guarantees, fund systems, etc.

Financial insurance transfer refers to the transfer of risk to an insurance company (insurer) through the conclusion of an insurance contract. When individuals face risks, they can pay a certain premium to the insurer to transfer the risk. Once the expected risk occurs and causes losses, the insurer must provide financial compensation within the scope of liability stipulated in the contract. Because insurance has many advantages, transferring risks through insurance is the most common way of risk management.

4. Risk conversion

Risk conversion refers to converting one risk into another or several other risks through some special means, making the converted risk easier to manage. , or a risk management strategy to gain additional profits.

A typical application of risk conversion strategy is convertible bonds. Convertible bonds refer to corporate bonds issued by the issuer in accordance with legal procedures and can be converted into stocks (usually ordinary shares) within a certain period of time according to agreed conditions. When holding the bond, the main risks faced include the risk of failure to issue convertible bonds, the risk of stock listing failure, the risk that convertible bonds cannot be converted into shares upon maturity, the risk of dilution of earnings per share and return on net assets after conversion, and Convertible bond price fluctuation risks, etc. When the bonds are successfully converted into ordinary stocks, the risks faced by the holders are converted into stock price fluctuation risks, stock hold-up risks, etc., and may bring certain profits.

5. Risk hedging

There are two explanations for risk hedging. One is to reduce the size of these risks by taking on a variety of related risks and creating a hedging relationship between these related risks. Management strategy; another explanation refers to a risk management strategy that offsets the potential risk losses of the underlying asset by investing in or purchasing certain assets or derivatives that are negatively correlated with the fluctuations in the underlying asset's returns. Typical examples are hedging business and options trading business.

6. Risk compensation

Risk compensation refers to the establishment of necessary compensation mechanisms for risk-taking measures beforehand (before losses occur) to increase the confidence and courage of individuals or units to take risks. .

Generally speaking, this risk compensation strategy can be adopted for those risks that cannot be managed through risk hedging, risk conversion or risk transfer, and that cannot be avoided and have to be borne. A typical application is the compensation mechanism for evaluation and incentives of marketing personnel in marketing. For example, the company sent Xiao Zhang to explore new markets in the northwest. According to the company's current performance-oriented sales assessment method, it was difficult for Xiao Zhang to complete the sales task. Therefore, the probability of receiving a bonus was very small and his work enthusiasm was not high. Therefore, the sales director alone He formulated a compensation plan: If Xiao Zhang fails to complete the sales task, but as long as there is a 20% increase every month compared to the previous month, he can receive an additional bonus. In this way, Xiao Zhang's work enthusiasm will be much higher. This is a typical risk compensation strategy.

7. Risk control

Risk control means that after weighing the cost-benefit, the enterprise is prepared to take appropriate control measures to reduce risks or mitigate losses, and to control risks within the risk tolerance. Strategy. Since the two main dimensions of risk are the likelihood of occurrence and the degree of impact after the occurrence, risk control is to reduce the possibility of occurrence, or reduce the degree of impact after the occurrence to reduce the risk level.

For example, a group company wants to participate in a project investment with an investment amount of 100 million yuan. The more the first investment, the greater the return will be if the project succeeds, and the greater the return will be if the project fails. The losses are also greater. After analysis, the company decided to take risk control measures: the first measure is to reduce the possibility of risk occurrence, that is, to deploy a large number of professional project management talents, improve project quality, strengthen project supervision, and better ensure the success of the project; the other The first measure is to reduce the impact of the risk after it occurs, which is to invest 100 million yuan in batches, with 40 million yuan invested in the first time. If the project progresses well, 30 million yuan will be invested in two batches in the later period. In this way, if the first investment fails, the loss will be 40 million, which actually reduces the impact of the risk after it occurs. What are the risk management strategies? Chapter 2

The financial risk of an enterprise refers to the uncertainty of the financial situation due to various factors that are difficult to predict or control in the process of various financial activities, thus causing the enterprise to have uncertainties. Possibility of Loss.

Under market economy conditions, financial risks exist objectively, and it is unrealistic to completely eliminate risks and their impact. The goals of enterprise financial risk management are: to understand the sources and characteristics of risks, correctly predict and measure financial risks, carry out appropriate control and prevention, improve risk management mechanisms, improve financial policies, minimize losses, and create the greatest benefits for enterprises. income.

1. Financial policy and its position in corporate management

Financial policy generally refers to the indicators that financial entities use certain methods to consciously change financial objects to achieve corporate financial management goals. Financial policy has two different goal orientations and forms of expression because it has two different entities: the state and the enterprise:

(1) As far as the state entity is concerned, financial policy is the state’s financial rules, systems, etc. It is a mandatory financial policy that regulates corporate finance. Its basic goal is to regulate and restrict corporate financial activities as a coordination of macroeconomic policies. Judging from the content of financial policies, they mainly include regulations on the source form and management of capital, cash management methods, fixed asset depreciation methods, cost expenditure scope and standards, profit and distribution policies, etc.; From the perspective of the manifestation of financial policies, they are mainly the "Corporate Financial Rules" and the financial systems of various industries.

(2) As far as the enterprise is concerned, financial policy is a set of independent financial management action guidelines formulated or selected by the enterprise under the guidance of the national financial policy and based on the enterprise’s overall goals and practical requirements. It is an autonomous and selective financial policy. Its basic goal is to coordinate corporate operating policies, adjust corporate financial activities and coordinate corporate financial relationships, and strive to improve corporate financial efficiency. From the content of financial policy, it mainly includes risk management policy, credit management policy, financing management policy, operating fund management policy, investment management policy and dividend management policy, etc.; from the expression of financial policy, it is a set of Autonomous and flexible internal financial system.

Under the background of my country's long-term implementation of the planned economic system, enterprises, as appendages of the government, have no independent management rights. Enterprise financial behavior can only be a passive behavior, and financial policies are basically based on the state. As the main body of compulsory financial policies, companies have very limited options to choose from, resulting in companies having "no money to manage." With the establishment of the socialist market economic system and the establishment of the status of enterprises as market entities, especially the establishment of financial entities with legal person status, corporate financial behavior has become a positive and proactive behavior, and autonomous and selective financial policies have become the responsibility of financial managers. The external manifestation of financial management. In this case, the status of corporate financial policy becomes more and more important. It is an important guarantee for realizing the entire enterprise's operating policies and financial goals. It is also an important basis for standardizing and optimizing corporate financial management behavior and improving corporate financial management efficiency.

2. Problems faced by current financial management

1. The original property rights theory and system have intensified the conflict of interests among shareholders, operators and employees. Knowledge economy is an economy based on the production, distribution and use of knowledge and information. It changes the traditional resource allocation structure with factories, machines and capital as the main content into a resource allocation structure with knowledge capital as the main content. However, our existing property rights theories and systems still maintain the "owner property rights theory" and ignore the important role of human capital in company development. In fact, in the existing market economy, employees who create, accept, utilize, process information and master knowledge and technology play an increasingly important role in the creation of corporate wealth. Therefore, in the transition period from the traditional industrial economy to the knowledge economy, modern enterprises are no longer just a matter of "separation of ownership and management rights". Modern enterprises are actually a matter of the separation between financial capital and intellectual capital and their ownership. "Compound contract" is the property rights cooperation of "stakeholders". The property rights theory and system in the traditional industrial economic era only focus on the allocation of tangible assets and investment capital, ignore the effective allocation of intellectual capital, only focus on the investor’s enjoyment of the enterprise’s residual claim rights, and exclude the residual distribution of intellectual labor and other relevant stakeholders to the enterprise. rights, thus exacerbating conflicts and contradictions among stakeholders such as owners (shareholders), operators, and employees. In this case, it is necessary for financial personnel to further clarify whose interests should be maximized as the company's financial management goals.

2. Risk management has become an important issue in financial management.

With the advent of the knowledge economy, enterprises will face more risks:

(1) Due to the networking and virtualization of economic activities, the speed of information dissemination, processing and feedback will be greatly accelerated. If enterprises Insufficient and untimely disclosure of internal and external information, or the inability of corporate authorities to timely and effectively choose to utilize internal and external information, will increase the company's decision-making risks;

(2) Due to knowledge accumulation and innovation If the enterprise and its employees cannot respond in time, they will not be able to adapt to the development and changes of the environment, which will further increase the risk of the enterprise;

(3) The development of high and new technologies makes the product life cycle continuous. Shortening, which not only increases inventory risks, but also increases product design and development risks;

(4) Due to the unlimited expansion of “media space” and the application of “online banking” and “electronic money” , accelerating international capital flows, thereby further intensifying commodity market risks;

(5) Driven by the pursuit of high returns, companies invest a large amount of funds in high-tech industries and intangible assets, making Investment risks have further increased. Therefore, how to effectively prevent and resist various risks and crises so that enterprises can better pursue innovation and development has become an important issue that needs to be studied and solved in financial management.

3. The existing financial management theory and content no longer meet the needs of investment decision-making in the era of knowledge economy. In the era of traditional industrial economy, economic growth mainly relies on tangible assets such as factories and machine capital; in the era of knowledge economy, intangible assets such as patent rights, trademark rights, computer software, talent quality, and product innovation are based on knowledge in the enterprise asset structure. The proportion will be greatly increased. Intangible assets will become the main and most important investment objects of enterprises. However, current theories and content of financial management rarely involve intangible assets. In actual financial management activities, many companies often underestimate the value of intangible assets and are not good at using intangible assets for capital operations. The traditional financial management theory and content in the era of industrial economy no longer meet the needs of investment decision-making in the era of knowledge economy.

4. The existing financial institution setup and the quality of financial personnel seriously hinder informatization and knowledge-based financial management. With the advent of the knowledge economy, all economic activities must be guided by fast, accurate and complete information. The establishment of corporate financial institutions should have few management levels and intermediate managers, and be flexible, efficient, and fast. Most of the existing corporate financial institutions in my country are pyramid-shaped, with many intermediate levels, low efficiency, and lack of innovation and flexibility. sex; financial management personnel have lagging financial concepts, lack of financial knowledge, and backward financial management methods. They are accustomed to obeying leadership, lack the initiative to master knowledge, and lack innovative spirit and ability. All this is far from the requirements of the knowledge-based economy era and has seriously hindered the process of informatization and knowledge-based financial management.

3. Prediction and Measurement of Financial Risks

The financial activities of an enterprise run through the entire process of production and operation. Raising funds, long-term and short-term investments, and distributing profits may all cause risks. According to the source of risk, financial risks can be divided into:

(1) Financing risk refers to the uncertainty caused by the financing of enterprises to financial results due to changes in the capital supply and demand market and the macroeconomic environment.

(2) Investment risk refers to the risk that after an enterprise invests a certain amount of funds, the final return will deviate from the expected return due to changes in market demand.

(3) Cash flow risk refers to the risk caused by the time inconsistency between corporate cash outflows and cash inflows.

(4) Foreign exchange risk refers to the uncertainty of an enterprise’s foreign exchange business results caused by changes in exchange rates. Specifically, it includes economic risk, transaction risk and conversion risk. Economic risk refers to the impact of unexpected changes in exchange rates in the foreign exchange market that will affect an enterprise's foreign exchange business. Transaction risk refers to the possible losses that an enterprise may suffer due to inconsistent exchange rates between the transaction date and the settlement date when conducting foreign currency business. Translation risk refers to the impact on accounting statements caused by exchange rate changes when an enterprise converts accounting statements expressed in foreign currencies into accounting statements expressed in a specific currency.

A correct understanding of the sources and types of financial risks is the prerequisite for financial risk prediction and measurement. On this basis, enterprises should establish a financial information network to ensure timely access to large quantities and high quality financial information, and create conditions for correct decision-making and risk prediction.

Enterprises collect and organize information related to risk prediction, including internal financial information and production technology data, plans and statistical data, market information from the company to the department and production and operation information of competitors in the same industry.

On the basis of preliminary forecasts, financial risks can be measured with the help of simplified models, that is, the expected returns under risky conditions can be calculated. Usually a combination of qualitative and quantitative methods is used to combine the analysis and judgment of the situation with the compilation and calculation of the data. Since risk and probability are directly related, probability and statistical methods are often used to measure the degree of risk. First analyze the probabilities of various possible situations and the possible benefits or costs, calculate the expected value, variance and standard deviation of the benefits or costs, and finally judge the degree of risk based on the coefficient of variation. Sensitivity analysis can also be used to determine the scope of each risk factor. Especially in the prediction of investment risks, investment projects are often selected by measuring the sensitivity of indicators such as annual cash inflow, investment payback period, and internal rate of return. to reduce risk.

4. Financial risk management strategies

1. Develop strict control plans to reduce risks.

Diversified operations are the preferred method for enterprises to diversify risks. Diversified operation means that an enterprise is involved in several basically unrelated industrial sectors at the same time, produces and operates several types of unrelated products, and competes with corresponding opponents in several basically unrelated markets. The theoretical basis for diversified operations to spread risks is: from the perspective of probability and statistics principles, the profit margins of different products are independent or incompletely related. Operating multiple industries and multiple products complement each other in time, space, and profit, which can reduce Corporate profit risk. On the premise of highlighting the main business, enterprises can combine their own human, financial and technological research and development capabilities to moderately engage in diversified operations and diversified investments to diversify financial risks.

2. Risk transfer method, including insurance transfer and non-insurance transfer.

Non-insurance transfer refers to the transfer of a specific risk to a specialized agency or department, such as selling products to the commercial sector and handing over some characteristic businesses to people with rich experience and skills, specialized personnel and equipment. Professional companies to complete etc. Insurance transfer means that the enterprise insures a certain risk to an insurance company and pays the insurance premium.

3. Self-insured risk means that the enterprise itself bears the risk.

Enterprises set aside risk compensation funds in advance and implement amortization in installments. At present, my country requires listed companies to withdraw bad debt reserves for accounts receivable, inventory depreciation reserves, short-term investment depreciation reserves and long-term investment impairment reserves, which are important measures for listed companies to prevent risks and operate steadily. In the process of financial activities, some risks can be predicted and controlled in the planning stage. The actual situation can be compared with the planned situation to analyze the control effect. Some risks are sudden and unpredictable. The source and nature of the risk should be identified, the losses should be calculated, and the best way to control or weaken the risk should be found.

4. Establish a sound financial risk mechanism

The financial risk mechanism of an enterprise is to introduce the risk mechanism into the enterprise so that the enterprise operators can assume risk responsibilities and exercise their responsibility in the fierce competition. It has the right to control financial risks and obtain returns from risky operations. For risk takers, first of all, they are required to establish a correct risk awareness and clarify their responsibilities legally and economically; secondly, risk takers must be given certain investment decision-making rights, fund raising rights, and fund allocation rights to enable decision-makers to While exercising rights, fully consider the ever-changing internal and external environment of the enterprise, and carefully consider the raising, use, and allocation of funds; thirdly, risk holders must enjoy risk rewards, have clear responsibilities and rights, and mobilize their enthusiasm. Establishing a sound financial risk mechanism also requires enterprises to distinguish risk responsibilities and determine channels for enterprises to compensate for risk losses, so as to truly reflect the effectiveness of enterprise risk control and management.