Better risk management leads to higher firm value and wealth creation.
The article reviews how managing risks can benefit companies by improving their value and performance. It looks at different types of risks, how risk management has evolved, and how it affects firm performance. The research shows that good risk management can lead to better decision-making and not just reducing risks. Companies with strong risk management tend to have higher values and lower financial troubles. Overall, effective risk management can help companies make more money and avoid costly problems.