Page 182 - RISK Management IC 86

Risk Management

goods are mostly sold on extended credit, where
even if the buyer is willing and able to pay, he may
be prevented from doing so because of exchange
control regulations or other restrictions imposed by
the government.

(iv) Personnel Risks - The success or failure of an
enterprise depends largely upon the ability, integrity,
and enthusiasm of its directors, managers, and
employees. The loss of a key man due to accident
or illness or death may jeopardize the success of a
programme, such as the negotiation of a major sales
contract.

A company may also incur heavy loss owing to
embezzlement of funds, passing of trade secrets to
competitors, or because of poor industrial relations.

(v) Environmental Risks - Society has become
increasingly aware of the damage and injury caused
by the release of contaminants into the air or water
bodies. Firms also run the risk of legal, social,
political and economic environment in which they
operate.

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