Sustainable Metrics in Project Financial Risk Management

Barbara Gładysz and Dorota Kuchta ()
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Barbara Gładysz: Faculty of Management, Wroclaw University of Science and Technology, 50-370 Wrocław, Poland
Dorota Kuchta: Faculty of Management, Wroclaw University of Science and Technology, 50-370 Wrocław, Poland

Sustainability, 2022, vol. 14, issue 21, 1-16

Abstract: The objective of this study is to propose an approach that would increase the efficiency and efficacy of project financial risk management. The starting point of this research is an original detailed list of project financial risk categories, as it was observed that financial risk is described in the literature far too generally. Following a survey of project managers, it is shown that all the identified project financial risk categories are significant and early warning signals may play an important role in their prevention or mitigation. Additionally, the main causes for project financial risks are identified and their importance assessed. Following a literature review on metrics-based and financial risk management in projects, as well as an analysis of the causes assessed in the survey, it is hypothesised that sustainability principles, combined with metrics-based management, may increase the efficiency and efficacy of project financial risk management. A corresponding method is proposed, which should be embedded into the traditional process of project financial risk management. This method consists of generating metrics with a warning and preventive potential for each combination of three elements (financial risk category, risk cause, sustainability principle). This approach introduces into project financial risk management elements going beyond the financial optics, which may considerably increase its potential.

Keywords: project risk; project cost; project revenues; metrics-based project management; sustainable project management; project financial management (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
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