Development of the Risk Management System in Croatian Companies
Development of the Risk Management System in Croatian Companies

Author(s): Josip Kereta
Subject(s): Social Sciences, Economy
Published by: Udruženje ekonomista i menadžera Balkana
Keywords: Risk; Risk management; Croatian companies; Competitiveness; “Weight of evidence” method; International business
Summary/Abstract: Modern business conditions change significantly and the company and the management face the challenge of how to predict the future and make timely decisions to prepare the company for future business. Therefore, increasing attention is paid to the issue of risk management. This paper presents a theoretical and practical contribution to understanding the importance of risk management systems in Croatian companies operating in international markets. Modern business conditions are discussed in the introduction, and then the term “risk management system” is conceptually discussed. The research part of the paper presents the results of empirical research on the perception of respondents about the degree of development of risk management systems in their companies using the “Weight of Evidence” method. The “Weight of Evidence” method is a method used to calculate the value of the strength of the influence of each represented variable from the observed samples on the defined target variable. A low level of system development has been established. Risk management systems, unfortunately, are only used by large companies. The application of a comprehensive risk management system can significantly increase the efficiency and effectiveness of the company’s business, and accelerate the economic development of the Republic of Croatia.

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