Risk Management Resource Center

Managing risk is important at any time. Given the renewed volatility and uncertainty surrounding currencies, interest rates and commodities, how should your company be hedging these exposures? What's the outlook for the euro and other currencies? What's the outlook for long term interest rates? What are potential short and long term effects from the ongoing debt crisis on U.S. corporations? Does your company have the right policies and metrics in place to accurately measure your risk exposures?

The AFP Risk Management Resource Center is here to provide information on solutions and best practices to manage your essential risk needs.

•  In Practice Guide: Six Steps to Assess Commodity Risk Exposure-- NEW!
  Given the current and future trends in commodity prices and volatility, every company must better understand its true commodity exposure. Companies can often be squeezed by rising and volatile commodity input prices that cannot be passed along to customers in their entirety. A commodity risk management program can help. Not all organizations can, or should, adopt the sophisticated mechanisms of a pure commodity business. However, most organizations, particularly those in the middle of the value chain, can improve their commodity risk analytics.
•  2012 Risk Survey -- NEW!
  AFP and Oliver Wyman have joined forces to produce a series of annual surveys to study the impact that risk and uncertainty have on Treasury and Finance and on organizations as a whole. The survey generated responses from 435 financial professionals across North America that provide insight on what companies perceive to be the biggest risks to earnings and the challenges in dealing with them.
•  Whitepaper: Volatility, Not Vulnerability -- NEW!
  Surviving Swings in Commodity Prices: Historically, most businesses could simply withstand changes in commodity prices, given that the swings were usually temporary, cyclical-and manageable. However, structural changes in the global economy are creating wilder swings in commodity prices that are not only affecting short term profits, but also long term planning and investment. In this environment every company must develop a formal risk management approach to counter the growing volatility in commodity prices. For corporate leaders, this means building the infrastructure, governance programs, and analytical capabilities that can help them better manage their exposure to commodities. This white paper outlines a risk management framework built around those three pillars: Governance, Infrastructure and Analytics.
• ERM Guide--NEW!
  Companies with effective governance, risk, and compliance programs are associated with higher levels of profitability and market valuation. While the practice of ERM has evolved and matured significantly over time, this guide discusses the critical challenges that need to be addressed.
  
• In Practice Guide: Counterparty Risk
• Risk! Monthly e-newsletter  
• Risk news articles
• Archived Webinar: Commodity Risk Management: Commodity Volatility in Consumer & Industrial Products
• Treasury and Finance Professionals Discuss Credit Card Risk  
• Discussions Boards  
• 2010 AFP Financial Risk Survey (FX)  
• Supply Chain Risk: Companies Must Develop Credit Scoring...  
• The New Weakest Link in Your Supply Chain: Supplier Credit  
• AFP's Foreign Currency Risk Management Policy Guidelines  

• Investing Cash: Managing Risks and Looking for Investment Opportunities in the Cash and Short Duration Markets  
• FX Hedge Optimization - Quantification Methodologies and Implementation Best Practices  
• Financial Risk Management - Evolution of a Hedging Strategy  
• Hedging FX Transaction and Translation Risk with Average Rate/Strike Instruments  
• Advanced Money Market Fund Due Diligence for Effective Enterprise Risk Management  
• Maintaining an Effective Financial Business Continuity Plan  

• This Week in Corporate Finance: Market Watches Greece with Concern Fear about Greece was the driving motivation this week as money fled in search of safety. Concerns about a possible Greek default or a messy departure from the Euro led to gains in U.S. Treasuries and German Bunds at the expense of equities.

  May 21, 2012

• All Eyes on Eurozone Crisis as GCTF Opens The CTC Global Corporate Treasurers Forum in Phoenix opened Thursday morning with a panel discussion on key issues facing the European, U.S. and global economies. Not surprisingly, the focus quickly turned to the eurozone crisis and what its fragility could mean for the global financial system.

  May 18, 2012

• Business Continuity: Can Treasurers Bank on Banks? When talking about business continuity, there is a plethora of information, research, and guidance on how to establish a remote or virtual office. Unfortunately, most treasurers devising business continuity strategies zero in on this one single aspect. But there is an even more menacing threat to treasury continuity: bank failure.

  May 14, 2012

• Hedging Currency Risk for Foreign Assets and Liabilities Multinational corporations tend to have assets or liabilities denominated in currencies other than their functional currencies. And when this happens, the income statement of that company will generally be subject to currency exchange rate risk.

  May 11, 2012

• May 2012 AFP Risk! Newsletter The issue starts with an article on the yuan—what will its expansion have on currency traders? Risk spoke with two FX experts to get the scoop. We are pleased to include research from our sister organization in the UK, gtnews, on the impact of the 2008 financial crisis on trade finance. Herbert Broens’ article builds on the data and is definitely worth a read. CPA Salome J. Tinker asks a provocative question: Do auditors post systemic risk?

  May 11, 2012