About the issue
Publications
Partners
September 2018 (published: 27.09.2018)
Number 3(34)
Home > Issue > How does corporate risk management mitigate
the effects of investment myopia
Makarova V.A. , Kalchenko A.V. , Patsey L.A.
Within the framework of the present work on the example of the metallurgical industry of Russia, the phenomenon of short-termism as a factor preventing the creation of a long-term strategy is studied. Disclosure of factors of distribution and strengthening of short-term policy development occurs in the theoretical part of this work through the prism of the theory of information asymmetry. In addition, the article presents the means by which it is possible to neutralize the consequences of the negative impact of short-termism in the light of the theory of risk management, the theory of agencies and their tools. The practical part of the study is reduced to the study of the degree of efficiency of corporate risk management on the example of a sample of companies, as well as econometric analysis of the company's tendency to short-termism. There is no significant model demonstrating the tendency of management to short-termism, but an indirect relationship between the effects of short-termism, expressed in such indicators as WACC and corporate risk management tools, based on the theory of risk management, is confirmed. Thus, considering the phenomenon of short-termism, in an attempt to get a reliable understanding of the processes that stimulate its appearance and the facts that reduce its presence in the company's management policy, we touched on the theory of information asymmetry, the theory of Agency relations, risk management, as theories closely intersecting and arising from one another in the study of the phenomenon of investment myopia.
Read the full article
Keywords: investment myopia, corporate risk management, theory of asymmetric information.
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License
UDC 338.242
How does corporate risk management mitigate
the effects of investment myopia
Within the framework of the present work on the example of the metallurgical industry of Russia, the phenomenon of short-termism as a factor preventing the creation of a long-term strategy is studied. Disclosure of factors of distribution and strengthening of short-term policy development occurs in the theoretical part of this work through the prism of the theory of information asymmetry. In addition, the article presents the means by which it is possible to neutralize the consequences of the negative impact of short-termism in the light of the theory of risk management, the theory of agencies and their tools. The practical part of the study is reduced to the study of the degree of efficiency of corporate risk management on the example of a sample of companies, as well as econometric analysis of the company's tendency to short-termism. There is no significant model demonstrating the tendency of management to short-termism, but an indirect relationship between the effects of short-termism, expressed in such indicators as WACC and corporate risk management tools, based on the theory of risk management, is confirmed. Thus, considering the phenomenon of short-termism, in an attempt to get a reliable understanding of the processes that stimulate its appearance and the facts that reduce its presence in the company's management policy, we touched on the theory of information asymmetry, the theory of Agency relations, risk management, as theories closely intersecting and arising from one another in the study of the phenomenon of investment myopia.
Read the full article
Keywords: investment myopia, corporate risk management, theory of asymmetric information.
DOI 10.17586/2310-1172-2018-11-3-61-75