Risk management by US and Canadian financial firms during the financial crisis

Michael Maingot, Tony Quon () and Daniel Zéghal
Additional contact information
Michael Maingot: University of Ottawa
Tony Quon: University of Ottawa
Daniel Zéghal: University of Ottawa

International Journal of Disclosure and Governance, 2018, vol. 15, issue 4, No 3, 234 pages

Abstract: Abstract The objectives are to examine the impact of the 2008 financial crisis on enterprise risk management (ERM) disclosures in US and Canadian financial firms, and to compare risk management between these two financial sectors. ERM disclosures were examined through a content analysis of the 2007 and 2008 annual reports. The number of risk disclosures increased only slightly from 2007 to 2008. When the levels of risk exposure, risk consequences and risk management were examined, the only change was the reporting of higher risk consequences from 2007 to 2008 by US companies. Canadian companies reported higher levels of risk exposure and risk consequences only for liquidity risk. While there were similarities in the disclosure of risks in the financial category, the US financial sector firms disclosed higher levels of risk exposure but managed these risks more passively, whereas the Canadian firms reported higher levels of risk consequences and managed these risks more actively. Firms in the financial sector have not been inclined to disclose more information about their risk management strategies, despite the importance of risk management in their business model. This information asymmetry has potential for significant costs to investors and society in general. A study comparing the US and Canadian financial sectors has not been done previously. Given the origins of the financial crisis in the US and the relatively stable Canadian financial sector, this study is overdue.

Keywords: Enterprise risk management; Financial sector; US; Canada; Financial crisis (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://link.springer.com/10.1057/s41310-018-0049-8 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:ijodag:v:15:y:2018:i:4:d:10.1057_s41310-018-0049-8

Ordering information: This journal article can be ordered from
https://www.palgrave.com/gp/journal/41310

DOI: 10.1057/s41310-018-0049-8

Access Statistics for this article

International Journal of Disclosure and Governance is currently edited by Michael Alles

More articles in International Journal of Disclosure and Governance from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().