• Journal of Korea Trade
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• v.24 no.1
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• pp.1-34
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• 2020

Purpose - In this study, we investigate determinants of hedging with derivatives and its effect on firm value and firm risk for Korean firms. Design/methodology - To avoid the endogeneity problem pointed out in previous studies, we use a two-stage analysis by using gains and losses from derivatives as instrument variable for hedging with derivatives. Findings - Our analysis on the determinants of hedging shows that firms that are more leveraged and less profitable, and with more growth opportunities are likely to hedge through derivatives. Additionally, large firms, firms less diversified into industry, and firms more diversified geographically are likely to use derivatives. Our two-stage analysis shows that indicators of hedging with derivatives have an insignificant effect on firm value, and the indicator of futures/forwards use and of swaps use have significant negative effect on firm value. Whereas, the extent of hedging with derivatives has positive effect on firm value for all types of foreign currency derivatives, which suggests that moderately low hedgers use derivatives inefficiently, but extensive hedgers use derivatives properly. With regard to firm risk, hedging with derivatives increases market-based risk, but decreases accounting-based risk. Thus, we conclude that Korean firms use derivatives to manage operational volatility rather than to manage market risk, and accounting-based risk reduction through hedging is not directly translated into higher firm value. Originality/value - This is not the first study to investigate hedging behavior of Korean firms, but the sample period that that this study analyzed is the longest and various method are used to control the endogeneity problem. We investigate not only total foreign currency derivatives but also by types of derivatives, including futures/forwards, options, and swaps.

• Korea Trade Review
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• v.45 no.2
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• pp.191-209
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• 2020

Project logistics is becoming increasingly important in overseas plant projects. Efficient logistics risk management is needed to reduce construction period and reduce costs. However, Korean construction firms bid unconditionally without sufficient experience and analysis on overseas plants contract, companies are gradually losing profitability on projects due to not considering profitability. Despite the significant effects on the profitability of Korean construction companies, and although these companies still continue to bid on overseas plant projects, policies to manage project logistics risks for safe transport and compliance with the contracted building schedule in the long term is still lacking. Hence, this study investigates the risk factors related to project logistics and to analyze the effect of project logistics risk on overseas plant business performance. We conducted a survey of project-related workers. The results of the analysis are as follows: First, among the logistics risk factors, overseas platform business people recognize operational risk and financial risk factors, which have a positive effect directly on overseas plant performance. Second, the ability to manage project logistics risks can have a significant impact on the success or failure of overseas plants. Finally, if logistics risk factors are managed on the basis of the research results confirmed through empirical analysis, it is possible to carry out more efficient and effective management of the project, which implies that this will have a positive effect on overseas plant business performance.

• Journal of the Society of Disaster Information
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• v.19 no.2
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• pp.411-420
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• 2023

Purpose: In order to compensate for the limitations of the risk assessment of hydrogen charging stations, it is proposed to apply business disaster reduction activities as a way to strengthen safety and business continuity for accidents that may occur during operation. Method: We explored the application of business disaster reduction activities that can reduce, eliminate, transfer, and accept risks by classifying risks according to the passage of time in the installation and operation of hydrogen charging stations, identifying key tasks, deriving risk scenarios. Result: Existing research results are appropriately applied to the risk assessment conducted in the stage before the installation of hydrogen charging stations. However, there is a limit to the risks that can occur at the operational stage, so applying business disaster reduction activities with several example scenarios has resulted in that it can be applied as a way to strengthen safety and business continuity. Conclusion: All of the currently implemented risk assessments for hydrogen charging stations are being used appropriately. However, it proposes business disaster reduction activities that apply various risk scenarios as an evaluation and response to possible risks at the operational stage.

• The Journal of Asian Finance, Economics and Business
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• v.8 no.5
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• pp.595-605
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• 2021

The objectives of this research are to see if the phenomena of "demand following" and "supply leading" exist in the business cycle, as well as to look at how liquidity and output react to changes in credit risk, investment-saving gap, inflation, exchange rate, and growth rate of real national output. Employing quarterly data of Maluku and North Maluku (2008-2019), this study utilizes VAR/VECM for inferential analysis. This research found three important findings. First, liquidity and output growth influenced each other in the long run. Second, the determinants of output growth for Maluku are liquidity, investment-saving gap, and inflation, while the determinants of liquidity are output-growth, the gap of investment-saving, and inflation. Third, the determinants of output growth for North Maluku are liquidity, credit risk, investment-saving gap, inflation, exchange rate, and the national output-growth, while the determinants of liquidity are output-growth, credit risk, investment-saving gap, inflation, exchange rate, and national output-growth. The findings of this study supported the hypothesis of demand following and supply leading theory in the Maluku and North Maluku business cycles. This study concludes that economic development would improve if supported by liquidity adequacy through increased deposit growth.

• Journal of the Korea Safety Management & Science
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• v.24 no.2
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• pp.67-76
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• 2022

Power generation construction projects involving large amounts of capital can affect the survival of a company along with huge economic losses in the event of a business failure. In general, private companies are organizations with challenging risk taking tendencies while public companies have a risk averse tendency to avoid risk, so these differences in organizational tendencies make it difficult to respond to risk. In particular, public companies are more likely to fail than private companies because they choose the contradiction of risk picking to enter overseas markets with high uncertainty despite their tendency to risk averse due to the nature of the organization. Therefore, these organizations need risk management techniques that reflect a risk-averse strategy. Accordingly, this paper analyzes the risk management research papers of the existing overseas development EPC business in order to find the risk management techniques related to the organizational tendencies of public companies and proposes "establishing a performance audit system for risk management of the organizational tendencies of public companies" as a way to extract the risk factors through the examples of overseas development projects of public companies and to manage the organizational tendencies of public companies that affect them.

• The Korean Journal of Franchise Management
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• v.13 no.4
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• pp.39-48
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• 2022

Purpose: COVID-19 has negatively influenced the financial performance of restaurant firms. Previous literature suggests that the franchising strategy effectively helps restaurant firms recover from difficult business conditions through various methods for expanding business size and enhancing business efficiency. According to risk-sharing theory, restaurant franchisors may minimize operational risks by sharing the risks with their franchisees. For instance, restaurant franchisors could generate more stable cash flow using franchise fees from their franchisees. However, research on the effect of franchise's risk reduction factor on business performance during pandemic is scarce. Thus, this study aims to examine the positive moderating effect of franchising between COVID-19 and restaurants' financial performance. Research design, data, and methodology: Panel data including financial information and franchising status of restaurant firms were collected for analysis. In order to control for unobserved firm-specific factors, generalized least squared estimation in fixed effects model was conducted. Huber-White robust standard errors were used to deal with heteroscedasticity issues. Results: It was found that COVID-19 pandemic has a negative effect on the restaurants' financial performance such as ROA (return on assets), ROE (return on equity), and PM (profit margins), which confirms the findings from existing literature. More importantly, results show that the degree of franchising has a positive moderating effect on the relationship between COVID-19 and financial performance of restaurant firms. This suggests that more active engagement in franchising may decrease negative impacts of COVID-19 on the restaurants' financial performance. Conclusions: The study supports existing literature related to risk-sharing theory, by confirming that pandemics, such as COVID-19, negatively affect financial performance of the restaurants. Furthermore, it was found that franchising strategy can help lessen negative impacts of pandemics on the firm performance. These findings can contribute to the franchise and restaurant management literature by suggesting the role of franchising in reducing business risks, thereby positively affecting financial performance. Moreover, this study offers business managers of franchisors and franchisees insights for utilizing franchising in restaurant risk management. Policymakers may also gain information on aiding restaurant firms during global crisis, such as COVID-19.

• The Journal of Asian Finance, Economics and Business
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• v.9 no.4
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• pp.53-62
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• 2022

Disposition Effect (DE) is one of the many investment biases, wherein the investors sell the profitable stocks rather quickly and they tend to hold on the loss making stocks. Various factors related to the DE are the character of investors applying risk management which is also influenced by the social media, Salient Shock (COVID-19), and in the specific case of Indonesia, the phenomenon of rumor stocks wherein the price can rise as much as up to 8500%. The study aims to provide empirical evidence regarding the DE with specific explanatory factors, namely investor behavior and rumors. Data was obtained through a questionnaire sent to 248 Indonesian Stock Exchange Investors (IDX) during the period October-November 2021 by using Ordinary Least Square (OLS) method. The results show: Generation Z, women, and investors with a low education has a greater DE, risk-takers tend to have lower DE, and professionals have negative DE. Implementation of risk management will reduce DE. Social Media and the COVID-19 situation positively affect DE. Especially on stock rumors, there is evidence that investors who own rumor stocks will have a low DE. The results indicate the need for: (i) risk management, especially for Z Generation, women and low education Investors, (ii) to provide positive information so that information on social media can be responded to positively.

• Journal of Internet Computing and Services
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• v.18 no.5
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• pp.123-131
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• 2017

With the rapid growth of mobile services, the various charging methods for mobile data have emerged in the mobile service market. Among them, network operators have begun to provide the zero-rating without any extra charge for the data that use the specific mobile application & services. Zero-rating, the free mobile data services by the network operators provoked many platform operators to confront business opportunity and risk. Though the platform operators are in urgent need of the strategy planning that considers business environments, any research endeavors explaining zero-rating and platform does not exist. Moreover, the analyses of potential effects of zero-rating on the business acts of platform operators has not been performed. Therefore, the study aims to identify the potential business opportunity and risk to prepare the various strategic countermeasure in platform operators' shoes. The study might enable the researchers to properly understand zero-rating and platform, and be utilized as a reference in planning the business strategy of the platform operators.

• The Journal of Fisheries Business Administration
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• v.39 no.3
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• pp.1-23
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• 2008

Recently, traceability systems are introduced as a new food safety information system. To trace food products efficiently, they must have an automatic identification capability at the individual product level. This capability can be gained through RFID technology. But there is not yet any performance evaluation tool on RFID-based traceability systems (RFID-TS). This study developed an evaluation tool of RFID-TS. To develop the tool, this study considered the objective and the components of RFID-TS as their performance constructs. According to Churchill's paradigm, the tool was established through two stages. The final evaluation tool consisted of four constructs (risk, operational benefits, IS (information system), and network) and nine sub-constructs. Among the four constructs, risk and IS were found as the most important performance constructs through regression analysis. Among the nine sub-constructs, service (which belonged to the IS construct) and economic risk (which belonged to the risk construct) were found as the most important performance sub-constructs.

• Journal of Korea Technology Innovation Society
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• v.7 no.3
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• pp.479-505
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• 2004

The purpose of this study is to investigate between CEO's Entrepreneurship in Venture Business and Organizational Effectiveness. CEO's Entrepreneurship variable consist of Innovativeness, Risk-taking and Proactiveness. Organizational effectiveness concept composed of system approach and the contingency theory and it's variable consisted of job satisfaction and organizational commitment. Statistical methods are adapted Frequency, Factor Analysis and CFA(Confirmatory Factor Analysis) of LISREL.8 program. Refined Survey data are 412/Major findings are as follows; Only Proactiveness variable of CEO's entrepreneurship have significant relation to Organizational Effectiveness(job satisfaction and organizational involvement). Innovativeness and Risk taking variables are partially supported to influence to Organizational Effectiveness.