Decentralization of Decisions and Governance of Risk in Cooperative Contexts

Nathalie Bénet (), Aude Deville () and Séverine Ventolini ()
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Nathalie Bénet: Université Toulouse Capitole, TSM-Research CNRS
Aude Deville: Université Côte d’Azur, IAE Nice, GRM
Séverine Ventolini: Université de Tours, IAE, VALLOREM

Chapter Chapter 5 in Contemporary Trends in European Cooperative Banking, 2022, pp 97-117 from Springer

Abstract: Abstract As for any financial institution, the governance of risks in cooperative banks is a central matter of strategic and management concern. The purpose of this chapter is to explore how cooperative banks tackle the challenge of the governance of risks. More particularly, we investigate how the decentralization of decisions in cooperative banks, combined with a strong anchor and communication on cooperative values, help mitigate risks. We focus particularly on credit risk, which is one of the most important risks for this type of banks. To discuss how the decentralization of decisions supports governance of risks, we present the case of a French cooperative banking group. Findings show the importance of the notion of “shared risk-taking” in credit decisions and of the multidimensional features of soft information use.

Keywords: Cooperative banks; Governance; Governance of risks; Decentralization of decisions; Credit risk; Market risk (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-030-98194-5_5

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DOI: 10.1007/978-3-030-98194-5_5

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