This document defines different types of business risk and discusses risk management. It outlines insurable and uninsurable risks, as well as controllable and uncontrollable risks. Financial, operational, compliance, and reputational risks are also examined. Pure risks that only pose the threat of loss and speculative risks that involve potential for loss or profit are compared. The document then explains that risk management is the systematic process of managing risks to achieve business objectives, though total risk elimination is not possible. Key risk handling methods are identified as risk transfer, acceptance, reduction, and avoidance.

1. M. Ehtisham Jadoon

2. Business-Providing
goods and services
Risk-Possibility of
loss or damage
Business Risk- Risk
of loss that is
naturally incurred by
owning or operating
a business

3. Types of Risk
 Insurable or uninsurable
 Controllable or uncontrollable

6. Other Types of Risk
 Financial Risk
 Operational Risk
 Compliance Risk
 Reputational Risk

7. Other Types of Risk
 Pure risk
Threat of loss with no opportunity of gain
Examples include
• Change in business conditions
• Human mistakes and thefts
• Possibility of catastrophe or environmental change
 Speculative risk
Risking loss to make a profit.
Possibility of seeing a loss, no change, or actually making profit
Examples include
• buying new machinery
• constructing new buildings
• Hedging Techniques

8. Risk management
 The systematic process of managing risk to achieve
your business objectives.
 Risk cannot be totally eliminated, but it can be
reduced and managed.

9. Planning Risk Management

10. Example!

11. Risk Handling
 Business use these 4 methods individually or some
combination to handle risk.
 Transfer
 Accept
 Reduce
 Avoidance

13. Thank You!
Any Questions!