Financing Risk - Publications - Faculty & Research

January 2004 (Revised December 2012)
Case

Farmington Industries, Inc.: Managing Currency Exposure Risk

By: David F. Hawkins and Jacob Cohen

The December 20, 1994 Mexican devaluation creates U.S. dollar losses for an unprepared U.S. corporation with multiple operations in Mexico. View Details

Keywords: International Finance; Globalized Firms and Management; International Accounting; Currency; United States; Mexico

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22 Jun 2014
News

Pension Funds Urged to Publish Climate Risks

fall 1993
Article

Theory of Risk Capital in Financial Firms

By: Robert C. Merton and André Perold

Keywords: Theory; Risk and Uncertainty; Capital; Business Ventures; Financial Services Industry

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01 Feb 1997
News

Merton Discusses Risk Management at Dean's Seminar

increasingly must make sophisticated financial decisions. Last November, Robert C. Merton, the George Fisher Baker Professor of Business Administration at HBS, discussed this problem and elaborated on the importance of risk management in... View Details

Keywords: Elizabeth McNair

October 2021
Article

Shareholder Activism and Firms' Voluntary Disclosure of Climate Change Risks

By: Caroline Flammer, Michael W. Toffel and Kala Viswanathan

This paper examines whether—in the absence of mandated disclosure requirements—shareholder activism can elicit greater disclosure of firms’ exposure to climate change risks. We find that environmental shareholder activism increases the voluntary disclosure of climate... View Details

Keywords: Transparency; Reporting; Shareholder Engagement; Shareholder Activism; Climate Change; Risk and Uncertainty; Environmental Management; Investment Activism; Corporate Disclosure; Communication Strategy; Information Publishing; Measurement and Metrics; Corporate Social Responsibility and Impact; Problems and Challenges; United States

22 Jun 2014
News

Pension funds urged to publish climate risks

January 2004 (Revised April 2011)
Teaching Note

Farmington Industries,Inc.: Managing Currency Exposure Risk (TN)

By: David F. Hawkins and Jacob Cohen

Teaching Note to 104053. View Details

Keywords: Currency Exchange Rate; Electronics Industry; Mexico

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July 2021 (Revised February 2022)
Technical Note

RegTech: A New Way to Manage Risks

By: Aiyesha Dey, Jonas Heese and James Barnett

A note on regulatory technology (RegTech) describing its evolution, use cases, and the competitive environment in 2021. View Details

Keywords: Regulatory Technology; Change; Financial Management; Governance Compliance; Governance Controls; Technology; Banking Industry; Financial Services Industry; Technology Industry

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June 2024
Article

Counterparty Risk and Counterparty Choice in the Credit Default Swap Market

By: Wenxin Du, Salil Gadgil, Michael Gordy and Clara Vega

We investigate how market participants price and manage counterparty credit risk using confidential trade repository data on single-name credit default swap (CDS) transactions. We find that counterparty risk has a modest impact on the pricing of CDS contracts but a... View Details

Keywords: Credit Derivatives and Swaps; Market Participation; Risk and Uncertainty; Price; Financial Markets; Credit

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02 Jun 2020
News

Protesters Weigh Virus Risks on Crowded Streets

Web

Banking System - Behavioral Finance & Financial Stability

Income from trading activities was strongly negative in several years during the financial crisis. Source: Bank Holding Company Y9C Data Accounting Measures of Risk The ratio of risk-weighted assets to assets decreased after the financial... View Details

October 1992 (Revised August 1994)
Case

Allied-Signal: Managing the Hazardous Waste Liability Risk

By: Richard H.K. Vietor and Edward Prewitt

Allied-Signal, Inc., one of the world's oldest chemical companies and today a diversified conglomerate, is liable for clean-up costs of old hazardous waste sites. These costs are substantial: reserves grew to nearly $500 million in 1991. Attempting to avoid further... View Details

Keywords: Wastes and Waste Processing; Environmental Sustainability; Programs; Cost Management; Policy; Government Legislation; Factories, Labs, and Plants; Governance Compliance; Legal Liability; Chemical Industry; United States; Europe

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2011
Book

Moving Forward: The Future of Consumer Credit and Mortgage Finance

By: Nicolas P. Retsinas and Eric Belsky

The recent collapse of the mortgage market revealed fractures in the credit market that have deep roots in the system's structure, conduct, and regulation. The time has come for a clear-eyed assessment of what happened and how the system should be strengthened and... View Details

Keywords: Financial Crisis; Capital Markets; Credit; Financial Markets; Mortgages; Personal Finance; Governing Rules, Regulations, and Reforms; Demand and Consumers; Financial Services Industry

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2010
Chapter

Measuring and Managing Macrofinancial Risk and Financial Stability: A New Framework

By: Dale F. Gray, Robert C. Merton and Zvi Bodie

This paper proposes a new approach to improve the way central banks can analyze and manage the financial risks of a national economy. It is based on the modern theory and practice of contingent claims analysis (CCA), which is successfully used today at the level of... View Details

Keywords: Financial Statements; Economy; Financial Condition; Central Banking; Management Analysis, Tools, and Techniques; Management Practices and Processes; Risk Management; Measurement and Metrics; System Shocks

Citation

December 10, 2013
Article

A Market-based Mechanism to Improve Capital Expenditures

By: Eric D. Werker

Keywords: Finance; Infrastructure; Debt; Political Risk; Expenditure; Ghana; Africa

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2007
Working Paper

New Framework for Measuring and Managing Macrofinancial Risk and Financial Stability

By: Dale F. Gray, Robert C. Merton and Zvi Bodie

This paper proposes a new approach to improve the way central banks can analyze and manage the financial risks of a national economy. It is based on the modern theory and practice of contingent claims analysis (CCA), which is successfully used today at the level of... View Details

Keywords: Financial Crisis; Macroeconomics; Central Banking; Risk Management

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18 Jun 2018
Working Paper Summaries

A Measure of Risk Appetite for the Macroeconomy

Keywords: by Carolin E. Pflueger, Emil Siriwardane, and Adi Sunderam

September 2011
Article

Information Risk and Fair Value: An Examination of Equity Betas

By: Edward J. Riedl and George Serafeim

Using a sample of U.S. financial institutions, we exploit recent mandatory disclosures of financial instruments designated as fair value level 1, 2, and 3 to test whether greater information risk in financial instrument fair values leads to higher cost of capital. We... View Details