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The Key to Risk Management: Management

In: Risk Management

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  • Adrian E. Tschoegl

    (The Wharton School of the University of Pennsylvania)

Abstract

The Barings, Daiwa Bank and Sumitomo Corp. financial debacles in the mid-1990s suggest that management failures rather than misfortune, errors, or complexity are a major source of the risk of financial debacles. These errors are systematic and are a concommittant of the structure of trading and of human nature. Risk management systems must take these facts into account. Two years after this chapter first appeared, John Rusnak, a trader at Allied Irish Bank’s US subsidiary lost US$691m in unauthorized trading.

Suggested Citation

  • Adrian E. Tschoegl, 2005. "The Key to Risk Management: Management," Springer Books, in: Michael Frenkel & Markus Rudolf & Ulrich Hommel (ed.), Risk Management, edition 0, pages 721-739, Springer.
    • Handle: RePEc:spr:sprchp:978-3-540-26993-9_37
    DOI: 10.1007/3-540-26993-2_37
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    Cited by:

    1. José M. Marín & Thomas A. Rangel, 2006. "The use of derivatives in the Spanish mutual fund industry," Economics Working Papers 990, Department of Economics and Business, Universitat Pompeu Fabra.
    2. Robin Snell & Dean Tjosvold & Sofia Fang, 2006. "Resolving ethical conflicts at workthrough cooperative goals and constructive controversy in the People's Republic of China," Asia Pacific Journal of Management, Springer, vol. 23(3), pages 319-343, September.

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