The Use of Derivatives in Slovenian Non-Financial Firms: Is Financial Risk Already Well Managed?
Zbornik radova Ekonomskog fakulteta u Rijeci, časopis za ekonomsku teoriju i praksu - Proceedings of Rijeka Faculty of Economics, Journal of Economics and Business, Vol. 24, No. 2, 2006, pp. 225-256
32 Pages Posted: 28 May 2013
Date Written: December 22, 2006
Abstract
Recent research about the financial behaviour of Slovenian firms has documented enterprise risk management as being one of its weakest areas. The goal of this article is to present insights into financial risk management, i.e. into the extent of the use of derivatives in the largest Slovenian firms and the related practices. The results are confronted with the same types of characteristics of US and German firms although being much larger) revealed in comparable studies. These firms provide relevant benchmarks for assessing the development gap since they operate in more advanced financial environments and are therefore expected to have much more refined approaches to the use of derivatives than Slovenian firms. A survey points to the much smaller extent of the use of derivatives by Slovenian firms. There is a substantial gap, especially in the area of risk management policies (e.g. documentation, reporting, counterparty risk, valuation etc.).
Keywords: corporate risk management, financial risk, survey analysis, risk determinants, exchange rate risk, interest rate risk, commodity risk, corporate finance, derivatives
JEL Classification: G30, G32
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Risk Management: Coordinating Corporate Investment and Financing Policies
By Kenneth Froot, David S. Scharfstein, ...
-
Why Firms Use Currency Derivatives
By Christopher Geczy, Bernadette A. Minton, ...
-
The Use of Foreign Currency Derivatives and Firm Market Value
-
Exchange Rate Exposure, Hedging, and the Use of Foreign Currency Derivatives
-
Do Firms Hedge in Response to Tax Incentives?
By John R. Graham and Daniel A. Rogers
-
How Much Do Firms Hedge with Derivatives?
By Wayne R. Guay and S.p. Kothari
-
How Much Do Firms Hedge with Derivatives?
By Wayne R. Guay and S.p. Kothari
-
By John M. Griffin and René M. Stulz