Using Fuzzy Delphi Technique to Identify Financial Factors Affecting Risk Management in Iranian Banks

Advances in Mathematical Finance and Applications

مقاله 7، دوره 7، شماره 4، دی 2022، صفحه 929-944   

نوع مقاله: Research Paper

شناسه دیجیتال (DOI): 10.22034/amfa.2021.1924365.1569

نویسندگان

Marzieh Fatemi Moghadam¹؛ Hassan Ghodrati Ghazaani^{* 2}؛ Hossein Panahian¹؛ Ali Akbar Farzin Far¹؛ Mehdi Madanchi Zaj³

¹Department of Accounting and Management, Kashan Branch, Islamic Azad University, Kashan, Iran

²Department of Management, Kashan Branch, Islamic Azad University, Kashan, Iran

³Department of Financial Management, Electronic Unit, Islamic Azad University, Tehran, Iran

چکیده

The intermediary role that commercial banks play between borrowers and lenders is significant for the development of a sustainable and healthy economy. If the banking system uses its collected resources properly, it will have a positive contribution to economic development. However, for this to happen, a bank must ensure that risks are accurately assessed and that appropriate approaches are designed to address potential risks. Due to the increasing integration of risk management plans in the culture and processes of organizations, various approaches have emerged to oppose the issue, which has caused doubts and shortcomings in its implementation. Therefore, identifying the financial and key factors for the success of risk management implementation in the organizational environment can help prevent possible defects in the implementation of processes. Therefore, in this study, the key financial factors of the success of implementing organizational risk management in Iranian banks were investigated. To investigate which of the identified factors in Iranian banks is significant, the fuzzy Delphi technique was used and effective factors were identified using the perspective of experts. The results showed that the factors of "appetite and risk tolerance", "willingness to take advantage of opportunities", "identification, analysis and response to risk" and "relationship of sectors", can be effective factors in implementing risk management Be an organization in Iranian banks.

کلیدواژه‌ها

Financial Factors؛ Risk؛ Organizational Risk Management؛ Key Success Factors؛ Fuzzy Delphi

مراجع

[1] Hamdi, K., Reshadatjoo, H., Haj Ghanbari, H., Provide a theoretical framework for determining the factors affecting organizational readiness to implement project risk management. Urban Management Studies, 2014, 6(19), P.41-32. (In Persian)

[2] Lin, T. J., Chang, H. Y., Yu, H. F., Kao, C. P., The Impact of Political Connections and Business Groups on Cash Holdings: Evidence From Chinese Listed Firms, Global Finance Journal, 2019, 40, P. 65-73. Doi: 10.1016/j.gfj.2018.10.001

[3] Hamdi, K., Reshadatjoo, H., Haj Ghanbari, H., Provide a theoretical framework for determining the factors affecting organizational readiness to implement project risk management. Urban Management Studies, 2014, 6(19), P.41-32. (In Persian)

[4] Lin, T. J., Chang, H. Y., Yu, H. F., Kao, C. P., The Impact of Political Connections and Business Groups on Cash Holdings: Evidence From Chinese Listed Firms, Global Finance Journal, 2019, 40, P. 65-73. Doi: 10.1016/j.gfj.2018.10.001

[5] Farid, D., Sadeghi, H., Gholami, A., Investigating the factors affecting the risk management of banks listed on the Tehran Stock Exchange and OTC, International Conference on Change Management, Tehran, Center for Applied Information Development, 2016. (In Persian)

[6] Anvary Rostami, A., Saberi, M., Hamidian, M., Esfandiyar Pour, M., Evaluating and Ranking the Firms in Chemical Industry Listed in Tehran Stock Exchange with TOPSIS. Advances in Mathematical Finance and Applications, 2017, 2(2), P. 73-79. Doi: 10.22034/amfa.2017.531319

[7] Memar, A., Reshadatjoo, H., Identifying the determinants of risk management and measuring its impact on strategic management in Tondgovian Petrochemical Company. Management Quarterly, 2014, 11(34), P. 82-73. (In Persian)

[8] Rezazadeh, J., Mohammadi, A., Managerial Ability, Political Connections and Fraudulent Financial Reporting. Accounting and Auditing Review, 2019, 26(2), 217-238.  Doi: 10.22059/acctgrev.2019.263263.1007956

[9] Vala, S., Leveling the indicators affecting organizational risk management using ISM technique. Quarterly Journal of New Research Approaches in Management and Accounting. 2019, 3(13), P. 70-58. (In Persian)

[10] Agarwal, R., Ansell, J., Strategic change in enterprise risk management. Strategic Change, 2016, 25(4), P. 427-439. Doi: 10.1002/jsc.2072

[11] Arena, M., Arnaboldi, M., Azzone, G., The organizational dynamics of enterprise risk management. Accounting, Organizations and Society, 2010, 35(7), P. 659-675. Doi: 10.1016/j.aos.2010.07.003

[12] Awojobi, O., Analysing risk management in banks: Evidence of bank efficiency and macroeconomic impact Journal of Money, Investment and Banking, 2011, 22, P. 1-16.

[13] Banham, R., Enterprising views of risk management. Journal of Accountancy, 2004.

[14] Aghaei, M., Hasanzadeh, B., Accounting Comparability and Its Effect on Investment Efficiency, Journal of Accounting knowledge, 2018, 9(2), P. 7-34.  Doi: 0.22103/jak.2018.11156.2531

[15] Berry, A., Phillips, J., Enterprise risk management: pulling it together. Risk Management, 2019, 45(9), P. 53-57.

[16] Bohnert, A., Gatzert, N., Hoyt, R.E., Lechner, P., The drivers and value of enterprise risk management: evidence from ERM ratings. The European Journal of Finance, 2019, 25(3), P. 234-255. Doi: 10.1080/1351847X.2018.1514314

[17] Booker, F.M., An EWRM framework: Developing effective risk management strategies to protect your organization. White Paper, August, 2003.

[18] Chalaki, P., Mansourfar, G., Karami, A., Review the effect of Management Ability on the Financial Distress, with an emphasis on Financial Flexibility in Tehran Stock Exchange listed companies, Journal of Financial Accounting Knowledge, 2018, 5(1), P.153-180. Doi: 10.30479/jfak.2018.1403

[19] Botha, D., Van Niekerk, D., Views from the Frontline: A critical assessment of local risk governance in South Africa. Jàmbá: Journal of Disaster Risk Studies, 2013, 5(2), P. 1-10. Doi: 10.4102/
jamba.v5i2.82

[20] Bromiley, P., McShane, M., Nair, A., Rustambekov, E., Enterprise risk management: Review, critique, and research directions. Long range planning, 2015, 48(4), P. 265-276. Doi: 10.1016/j.lrp.2014.07.005

[21] Che, X., Liebenberg, A.P., Effects of business diversification on asset risk-taking: Evidence from the US property-liability insurance industry. Journal of Banking & Finance, 2017, 77, P. 122-136. Doi: 10.1016/j.jbankfin.2017.01.004

[22] Committee of Sponsoring Organizations of the Treadway Commission, Enterprise Risk Management--Integrated Framework (New York, NY: COSO), 2004.

[23] Dabari, I. J., Saidin, S.Z., A theoretical framework on the level of risk management implementation in the Nigerian banking sector: The moderating effect of top management support. Procedia-Social and Behavioral Sciences, 2014, 164, P. 627-634. Doi: 10.1016/j.sbspro.2014.11.156

[24] Dionne, G., Risk management: History, definition, and critique. Risk Management and Insurance Review, 2013, 16(2), P. 147-166. Doi: 10.1111/rmir.12016

[25] Jamei, R. Investigating the Mathematical Models (TOPSIS, SAW) to Prioritize the Investments in the Accepted Pharmaceutical. Advances in Mathematical Finance and Applications, 2020, 5(2), P. 215-227. Doi: 10.22034/amfa.2020.1880616.1312

[26] Eick, C.L.M., Factors that promote effective risk management at universities classified by the Carnegie system, Doctoral/Research Universities-Extensive, 2004.

[27] Ernst, Y., Risk management guide from theory to practice: Evolving your organization's risk management, Insurance and Actuarial Advisory Services, 2001.

[28] Farrell, M., Gallagher, R., The valuation implications of enterprise risk management maturity. Journal of Risk and Insurance, 2015, 82(3), P. 625-657. Doi: 10.1111/jori.12035

[29] Fraser, J.R., Simkins, B.J., Narvaez, K., Implementing Enterprise Risk Management: Case Studies and Best Practices, Wiley, 2014.

[30] Gibson, M.D., Young, J., Critical success factors for the implementation of an operational risk management system, Corporate Ownership & Control, 2012, 10(1), P. 137-147. Doi: 10.22495/cocv10i1art12

[31] Hoyt, R.E., Liebenberg, A.P., The value of enterprise risk management. Journal of risk and insurance, 2011, 78(4), P. 795-822. Doi: 10.1111/j.1539-6975.2011.01413.x

[32] Hwang, B.G., Zhao, X., Ong, S.Y., Value management in Singaporean building projects: Implementation status, critical success factors, and risk factors. Journal of management in engineering, 2015, 31(6), Doi:  10.1061/(ASCE)ME.1943-5479.0000342

[33] Izadikhah, M., Farzipoor Saen, R. Solving voting system by data envelopment analysis for assessing sustainability of suppliers. Group Decis Negot, 2019, 28, P. 641–669. Doi: 10.1007/s10726-019-09616-7

[34] Izadikhah, M., Azadi, M., Toloo, M., Hussain, F.K., Sustainably resilient supply chains evaluation in public transport: A fuzzy chance-constrained two-stage DEA approach, Applied Soft Computing, 2021, 113(B), Doi: 10.1016/j.asoc.2021.107879.

[35] Poordavoodi, A., Reza, M., Haj, H., Rahmani, A. M., Izadikhah, M., Toward a More Accurate Web Service Selection Using Modified Interval DEA Models with Undesirable Outputs. CMES-Computer Modeling in Engineering & Sciences, 2020, 123(2), P. 525–570. Doi: 10.32604/cmes.2020.08854

[36] Azadi, M., Izadikhah, M., Ramezani, F., Hussain, F.K., A mixed ideal and anti-ideal DEA model: an application to evaluate cloud service providers, IMA Journal of Management Mathematics, 2000, 31(20), P. 233–256, Doi: 10.1093/imaman/dpz012

[37] Izadikhah, M., A Fuzzy Goal Programming Based Procedure for Machine Tool Selection, 2015, 28(1), P. 361-372, Doi: 10.3233/IFS-141311

[38] Izadikhah, M. Financial Assessment of Banks and Financial Institutes in Stock Exchange by Means of an Enhanced Two stage DEA Model. Advances in Mathematical Finance and Applications, 2021, 6(2), P. 207-232. Doi: 10.22034/amfa.2020.1910507.1491

[39] Javier, R.S., Enterprise-wide risk management-The driver of corporate governance. Loyola University Chicago Law Journal, 2008, 39(3), P. 1-25.

[40] Kasim, M.A.B., Unravelling the Myths of Enterprise Risk Management (ERM) and Shareholders’Wealth. International Journal of Emerging Research in Management & Technology, 2016, 5(11), P. 4-15.

[41] Kleffner, A. E., Lee, R., McGannon, B., Stronger corporate governance and its implications on risk management. Ivey Business Journal, 2003, 67(5), P. 1-14.

[40] Tahmasebi, M., Hossein Yari, G. Risk measurement and Implied volatility under Minimal Entropy Martingale Measure for Levy process. Advances in Mathematical Finance and Applications, 2020, 5(4), P. 449-467. Doi: 10.22034/amfa.2020.674944

[39] Lechner, P., Gatzert, N., Determinants and value of enterprise risk management: empirical evidence from Germany. The European Journal of Finance, 2018, 24(10), P. 867-887. Doi: 10.1080/1351847X.2017.1347100

[38] Manab, N., Othman, S., Kassim, I., Enterprise-wide risk management best practices: The critical success factors. OIDA International Journal of Sustainable Development, 2012, 4(3), P. 87-96. https://ssrn.com/abstract=2054977

[39] Meier, R.L., Integrating enterprise -wide risk management concepts into industrial technology curricula. Journal of Industrial Technology, 2000, 16(4), P. 1-15.

[40] Mensah, G., Gottwald, W., Enterprise risk management: Factors associated with effective implementation. SSRN, 2015, 2735096, Doi: 10.2139/ssrn.2735096

[41] Nair, A., Rustambekov, E., McShane, M., Fainshmidt, S., Enterprise risk management as a dynamic capability: A test of its effectiveness during a crisis. Managerial and Decision Economics, 2014, 35(8), P. 555-566. Doi: 10.1002/mde.2641

[42] Oliva, F.L., A maturity model for enterprise risk management. International Journal of Production Economics, 2016, 173, P. 66-79. Doi: 10.1016/j.ijpe.2015.12.007

[43] Oliveira, K., Méxas, M., Meiriño, M., Drumond, G., Critical success factors associated with the implementation of enterprise risk management. Journal of Risk Research, 2019, 22(8), P. 1004-1019. Doi: 10.1080/13669877.2018.1437061

[44] Ozturk, M., Aktan, B., The new Basel capital accord: In search of excellence at bank risk management. Review of Social, Economic and Business Studies, 2007, 7(8), P. 151-174.

[45] Paape, L., Speklè, R.F., The adoption and design of enterprise risk management practices: An empirical study. European Accounting Review, 2012, 21(3), P. 533-564. Doi: 10.1080/09638180.2012.661937

[46] Pagach, D.P., Warr, R.S., The effects of enterprise risk management on firm performance, Working Paper, North Carolina State University, Raleigh, NC, 2010.

[47] Piyananda, S.D.P., Chandrasena, S.M., Fernando, J.M.R., Bank-Specific Determinants Of Risk Management Efficiency: Evidence From Listed Commercial Banks In SriLanka.‏ 6th International Conference on Business and Information (ICBI), 2015.

[48] Renn, O., Sellke, P., Risk, Society and Policy Making: Risk Governance in a Complex World. International Journal of Performability Engineering, 2011, 7(4), P. 349-366. Doi: 10.23940/ijpe.11.4.p349.mag

[49] Riaz, S., Investigating the factors affecting risk management efficiency of commercial banks. Pakistan Business Review, 2016, 18(1), P. 247-266. Doi:  10.22555/pbr.v18i1.671

[50] Sanchez, H., Robert., B., Measuring portfolio strategic performance using key performance indicators. Project Management Journal, 2010, 41(5), P. 64-73. Doi: 10.1002/pmj.20165

[51] Sax, J., Torp, S.S., Speak up! Enhancing risk performance with enterprise risk management, leadership style and employee voice. Management Decision, 2015.

[52] Scheer, D., Risk governance and emerging technologies: learning from case study integration. Journal of Risk Research, 2013, 16(3-4), P. 355-368. Doi: 10.1080/13669877.2012.729519

[53] Sharman, R., Enterprise risk management-the KPMG approach. Risk Management, 2002, 31(26), P. 26-28.

[54] Simkins, B., Enterprise risk management: Current initiatives and issues journal of applied finance roundtable. Journal of Applied Finance, 2008, 18(1), P. 115-134.

[55] Stoll, M., Laner, D., Information system engineering promotes enterprise risk management. In Innovations and Advances in Computing, Informatics, Systems Sciences, Networking and Engineering. Springer, Cham, 2015.

[56] Thomya, W., Saenchaiyathon, K., The effects of organizational culture and enterprise risk management on organizational performance: A conceptual framework. International Business Management, 2015, 9(2), P. 158-163. Doi: 10.3923/ibm.2015.158.163

[57] Whitman, A.F., Is ERM legally required? Yes for financial and governmental institutions, no for private enterprises. Risk Management and Insurance Review, 2015, 18(2), P. 161-197. Doi: 10.1111/rmir.12045.

[58] Yaraghi, N., Langhe, R.G., Critical success factors for risk management systems. Journal of Risk Research, 2011, 14(5), P. 551-581. Doi: 10.1080/13669877.2010.547253

[59] Zhao, X., Hwang, B.G., Low, S.P., Critical success factors for enterprise risk management in Chinese construction companies. Construction Management and Economics, 2013, 31(12), P. 1199-1214. Doi: 10.1080/01446193.2013.867521

[60] Zhao, X., Hwang, B.G., Low, S.P., Implementing enterprise risk management in a Chinese construction firm based in Singapore, in Senaratne, S. and Sandanayake, Y.G. (eds) Proceedings of World Construction Conference 2012, Colombo, Sri Lanka, 28-30 June, Ceylon Institute of Builders, 2012, P. 434-444.