To read this content please select one of the options below:

Reconsidering contact risk and contractual risk management

Ralph Schuhmann (Department of Industrial Engineering, Ernst-Abbe-Hochschule Jena, Jena, Germany)
Bert Eichhorn (SRH, The International Management University, Berlin, Germany)

International Journal of Law and Management

ISSN: 1754-243X

Article publication date: 10 July 2017




The aim of this paper is to pursue three objectives: to assess the extent to which theoretical concepts and corporate practice are reflecting the contract’s risk management dimensions; to identify ways to make full usage of the contract’s risk dimensions for risk management purposes; to overcome the isolation of the contract caused by its perception as a legal instrument by integrating its handling into the overall corporate management processes.


Literature is analyzed regarding the contract’s roles as a source of risk and as a risk management device. Based on the relevant findings, it uses the Contractual Management Model to develop a concept that integrates all contract-related risk management processes in an enterprise.


The paper redefines the term “contract risk” in the light of modern understanding of contract functions and contract purposes. It shows that only Contractual Risk Management theory takes the management capacity of the contract fully into account. A Contractual Risk Management process is suggested which integrates all contract-related corporate management processes and aligns them to the requirements of transaction risk management and enterprise risk management.


The paper may guide executives to optimize corporate risk management processes through a better understanding of the risk potential of contract and of its risk management capacity. It provides a checklist of redefined contract risks as well as a concept that, for the first time, is aligning all contract-related management processes to support the corporate risk management system.



Schuhmann, R. and Eichhorn, B. (2017), "Reconsidering contact risk and contractual risk management", International Journal of Law and Management, Vol. 59 No. 4, pp. 504-521.



Emerald Publishing Limited

Copyright © 2017, Emerald Publishing Limited

Related articles