WIT Press


Risk Typology

Price

Free (open access)

Paper DOI

10.2495/RISK080221

Volume

39

Pages

7

Page Range

205 - 211

Published

2008

Size

402 kb

Author(s)

S. Zahedi

Abstract

This article considers the definition of risk. Since the conceptual definition of risk varies with perspectives, some of the perspectives ranging from event-driven to financial and business risks are described. The classification of risk is explored and different types of risks are considered. In order to decrease the chance of loss, risk managers must weigh the relative costs and benefits associated with activities that give rise to risk and try to minimize the costs. Keywords: risk definition, risk categorization, natural risks, human risks, political risks, social risks, economic risks, risk management. 1 Introduction This article considers some of the definitions of risk. An argument is made for distinguishing between different perspectives in the related literature, each focusing on a particular aspect of risk. The article continues with the classification of risk and elaborates more on those types of risks where there is a greater possibility of managing them through risk management techniques. 2 Risk definition There are different definitions of risk in management literature, among which are the following: • Risk is defined as uncertainty concerning loss [1]. • Risk is any source of randomness that may have an adverse impact on a person or corporation [2]. • Risk is the combination of the frequency, or probability, of occurrence and the consequence of special hazardous events [3].

Keywords

risk definition, risk categorization, natural risks, human risks, political risks, social risks, economic risks, risk management.