Financial Risk Management in SMEs: A New Conceptual Framework

René-Pascal van den Boom

International Business Research, 2020, vol. 13, issue 10, 85

Abstract: During the past decades, several risk management models have been developed and implemented. Merely, suitable for large firms. Nowadays, there is still a lack of a comprehensive framework for small and medium-sized enterprises (SMEs). This paper proposes a new conceptual Financial Risk Management framework for SMEs. The framework consists of two dimensions- Risk Management Process and Organizational Structure. Both dimensions contain several components, each component includes one or more items. To calculate scores on different levels Principal Component Analysis (PCA) is used to calculate weighting factors. We add a disparity factor to adjust the final score for an imbalance between dimensions. The educational level of the risk manager is tested positively as a determinant for FRM as well as for the two dimensions. The proposed framework may help individual SMEs evaluate and approve its financial risk management.

Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.ccsenet.org/journal/index.php/ibr/article/download/0/0/43739/45955 (application/pdf)
http://www.ccsenet.org/journal/index.php/ibr/article/view/0/43739 (text/html)

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:ibn:ibrjnl:v:13:y:2020:i:10:p:85

Access Statistics for this article

More articles in International Business Research from Canadian Center of Science and Education Contact information at EDIRC.
Bibliographic data for series maintained by Canadian Center of Science and Education ().