UNFOLDING ORGANIZATIONAL RISK AND COST ASSOCIATION FROM STAKEHOLDERS PERSPECTIVE: EVIDENCE FROM ASIAN EMERGING MARKETS

Asad Khan, Muhammad Ibrahim Khan, Shehzad Khan, Zia ur Rehman

Abstract


In this study we extend the conventional risk-return debate to a more intriguing and practically significant conundrum of risk-cost association. The analysis is performed on large sample of 4609 listed companies operating in nine Asian emerging markets, using 2SLS estimation. We established that risk act as a specter and have consequences for long term contractual relationship between key stakeholders and organization. Further, organizational costs are directly affected by organizational risks hence it also provides an immediate opportunity to management to take corrective measures. As whole, the empirical evidence provides an essential perspective and insight to understand the nature of organizational risk, slack, stakeholders and it implication for organizational costs in Asian emerging markets. 


Keywords


Risk, Organizational Cost, Firm-Specific Risk, Market Risk, Emerging Markets

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