ISSN: 1998 - 4162

JISR MSSE Journal Contents

Volume 18, Number 1, January 2020


An Empirical Analysis of Enterprise Risk Management and Firm’s Value: Evidence from Pakistan
Wajid Khan - , ,
Syed Qasim Shah - , ,


Abstract
From last few decades the firms has shifted their focus towards risk management from traditional risk management practices to enterprise risk management. For this purpose, the current study is designed to investigate the key firm’s characteristics that influence firms to adopt the enterprise risk management practices. Binary logistic regression analysis was used to determine the effect of key firm characteristics on decision of firms to implement ERM structure. Robust least square method was administered to determine the relationship among variables. Empirical results revealed that larger firms, firms with greater return on assets, and firms having more independent directors on board leads towards the implementation enterprise risk management. Study also found an encouraging significant relationship between implementing of this risk management and Tobin’s Q both in the short and long run. The implementation of enterprise risk management system augments the performance of firm soon after the induction of this system as revealed by the results.

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