forward-looking risk management


I just like the name of the concept. A quick google search led me to a review of Canadian Best Practices in Risk Management where the book “Seeing tomorrow: Rewriting the rules of Risk, by Ron S. Dembo and Andrew Freeman (John Wiley & Sons Inc. 1998) is presented.

The authors list the main elements of forward-looking risk management as being:

  • time horizon: “Over what period of time are we concerned to consider over exposure to risk?”
  • scenarios: “What events could unfold in the future and how would they affect the value of our investments?”
  • risk measure: “What is the unit we are using tu gauge our exposure to risk?”
  • benchmarks: “What are the points of comparison against which we can measure our performance?”

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