Risk Profile of the Airlines During the COVID-19 Pandemic: An Analysis Based on Narrative Press Release

Maizatulakma Abdullah ()
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Maizatulakma Abdullah: Center for Governance Resilience and Accountability Studies (GRACE), Faculty of Economics and Management, Universiti Kebangsaan Malaysia

A chapter in Corporate Governance and Sustainability, 2024, pp 175-201 from Springer

Abstract: Abstract The COVID-19 pandemic has wrought catastrophic impacts on the airline industry, yet little is understood about its specific effects on airline business operations and the most critical risks faced during its emergence. This study aims to address these gaps from the perspective of companies within the industry. Data was collected through content analysis of airlines’ press releases and analyzed using the Epistemic Network Analysis (ENA) tool. The sample comprises 10 airline companies, half-rated as five-star airlines and the other half as three-star airlines by Skytrax ratings in 2019. Data collection spanned from January 1, 2020, to the end of April 2020, capturing the initial stage of the pandemic. Results reveal that three-star airlines were more adversely affected by COVID-19 than their five-star counterparts regarding regulatory changes, customer demand, and service failures. However, five-star airlines faced higher liquidity risks due to operational costs associated with employee salaries and fuel. These findings offer incremental insights for stakeholders and assist in making better-informed decisions. Additionally, they provide valuable guidance to airline management in understanding and mitigating the industry’s most critical risks during significant disruption or unforeseen events, enhancing their risk management strategies.

Keywords: Risk; Airline industry; Black swan; COVID-19; Epistemic Network Analysis (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-981-97-7808-9_10

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DOI: 10.1007/978-981-97-7808-9_10

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