Comparative Analysis of Corporate Risk Management Practices in Croatian and Slovenian Companies

Danijela Miloš Sprèiæ Željko Ševiæ
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Danijela Miloš Sprèiæ Željko Ševiæ: Faculty of Economics, University of Zagreb, Zagreb, Croatia University of Greenwhich Business School, London, UK

Zagreb International Review of Economics and Business, 2008, vol. 11, issue 2, 63-80

Abstract: The paper explores differences as well as commonalities in corporate risk management practices and risk exposures in the large non-financial Slovenian and Croatian companies. Comparative analysis of survey results have revealed that the majority of analysed companies in both Croatia and Slovenia are using some form of risk management to manage interest-rate, foreign exchange, or commodity price risk. Regarding the intensity of influence of financial risks on the performance of the analysed companies, the results have shown that the price risk has the highest influence among the Slovenian as well as the Croatian companies. Croatian companies are more affected by currency risk than the Slovenian companies, while the interest-rate risk has been ranged as less important in comparison with commodity price and currency risks. The survey’s results have clearly indicated that Croatian and Slovenian non-financial companies manage financial risks primarily with simple risk management instruments such as natural hedging. In the case of derivatives use, forwards and swaps are by far the most important instruments in both countries, but futures as representatives of standardised derivatives and structured derivatives are more important in the Slovenian than in the Croatian companies.

Date: 2008
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