Risk Management & Finance
| Numbering Code | P-MGT75 60168 LE44 | Year/Term | 2022 ・ Second semester | |
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| Number of Credits | 2 | Course Type | Lecture | |
| Target Year | Target Student | |||
| Language | English | Day/Period |
Sat.2・3 every 2 weeks |
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| Instructor name |
Wakayama Kazuo (Part-time Lecturer) YAMAMOTO TAKASHI (Graduate School of Management Professor) |
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| Outline and Purpose of the Course |
Every business activity is facing a wide range of risks. While the so-called insurable risk (or pure risk) only causes damages and financial loss, other risks, such as business risk, may bring rewards to those willing to take them. Risk is not always danger but also the source of gain. In the latest finance and risk management theory, the concept of “risk management” is not a negative check process to prevent, mitigate and transfer risks, but the integral part of corporate/project planning to maximize its value. The recent convergence of finance and insurance and regulatory and economic environment changes triggered by 2008 market crash have accelerated the needs for Enterprise-wide Risk Management (ERM). Through the course, a student is expected to fuse and strengthen his/her general management capability with enhanced understanding of strategic risk management. This course focuses on ERM framework by COSO's(Note) global standards and the integration of corporate finance and risk management to provide a practical overview of the latest corporate/project risk management theories and techniques. The course consists of lectures, case studies(such as Microsoft, DuPont etc.), and quantitative risk analysis exercises which utilizes the latest PC-based risk analysis/simulation software. (Note: COSO/The Committee of Sponsoring Organizations of the Treadway Commission) |
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| Schedule and Contents |
Introduction Lecture #1-2: Orientation - Objective and structure of the course - Preview of major topics and issues to be covered in the course - Introduction to Monte-Carlo simulation and @Risk software Part 1: Principle and Theory Lecture #3: Overview of Risk Management (RM) - Objective of RM - Traditional RM Structure vs. Recent Approach RM Process (Case Analysis: Microsoft) - ERM framework by COSO Lecture #4: RM Process - Case Analysis: United Grain Growers Lecture #5-6 Financial Framework of RM - Mini-Case analysis Lecture #7 Risk Financing -Insurance and ART (Alternative Risk Transfer) / Integrated Risk Management (Insurative Model) : Lecture #8 Risk and Utility -Value Assessment of RM (Pricing of insurance) Lecture #9-10: Portfolio Theory and RM -Using PC-based calculation and analytical tools Part II: Practice and Application (Using @Risk Software) Lecture #11-12: Risk Assessment and RM optimization - Estimation of Loss Distribution/ Monte-Carlo Simulation / EP (Exceedance Probability) Curve -Case study: DuPont Lecture #13-14 Course Review and Lesson from the recent market clash |
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| Evaluation Methods and Policy | Class Participation (20%) Mini Assignment (20%) Report Exam and Term project(60%) | |||
| Course Requirements |
(1) Basic knowledge of Microsoft Excel, (2) Basic knowledge in corporate finance and economic theories is preferred (but not required. Essence will be covered at the class.) |
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| Textbooks | Textbooks/References | No assigned text book. Materials will be prepared by instructor. | ||
| References, etc. |
Doherty/Integrated Risk Management/McGraw-Hill/2000 Hrrington and Niehaus/Risk Management and Insurance/Irwin McGraw-Hill/2003 Shimpi/Integrating Corporate Risk Management/Texere/2001 Brealey, Myers and Allen/Principles of Corporate Finance/McGraw-Hill/2007 Skidelsky/Keynes: The Return of the Master/Public Affairs/2009 Bernstein/Against the Gods/John Wiley & Sons/1996 |
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