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The purpose of this paper is to evaluate the risk management benefits provided by the supplemental coverage option (SCO) insurance plan which was created in the 2014 Farm Bill. Specifically, the marginal expected utility benefits are compared with the potential additional subsidy cost introduced by the new program for a stylized example of a corn producer.

The paper uses a stylized simulation model examines the preferred insurance program choice for a typical Midwestern corn farmer. The expected utility of the farmer is calculated under their preferred insurance program choice both with and without the availability of the SCO program, and compared to the case where crop insurance is not available. Scenarios are examined for a range of farmer risk aversion levels, different levels of correlation between farm-level and county-level corn yields, and case with and without insurance premium subsidies.

The SCO program is found to enter into the preferred insurance program choice for risk averse farmers. As risk aversion increases, farmers are estimated to prefer higher coverage levels for individual products along with SCO coverage. While the availability of existing crop insurance programs are shown to substantially increase the expected utility of farmers, the marginal impact of adding SCO to the crop insurance program is relatively small. Furthermore, the additional expected benefits generated by SCO are shown to include both risk management and expected return components. With subsidies removed, the estimated marginal benefits provided by SCO are reduced significantly.

The findings of this paper can help inform the policy debate for future farm bills as agricultural support programs continue to evolve. The results in this paper can also be used to help explain farm-level decision making related to crop insurance program choices.

This paper contributes to the literature by documenting a new, federally supported risk management programs made available to farmers in the 2014 Farm Bill and evaluates the marginal benefits the SCO program offers US crop producers.

Malting barley is an important specialty crop in the Northern Plains and growers mitigate risk with federally subsidized crop insurance and production contracts. The purpose of this paper is to quantify risks growers face due to “coverage gaps” in crop insurance that result in uncertain indemnity payments when their crop does not meet contract specifications.

A stochastic dominance model is developed to evaluate alternative strategies for growers with differing risk attitudes and production practices (irrigation vs dryland).

The results illustrate how alternative crop insurance provisions affect efficient choice sets for growers. Risk premiums for irrigated growers all point to valuations favoring more coverage, contracts, and malting option B. As the crop insurance industry matures in the functions it performs, it will become increasingly more important to address quality attributes.

This paper addresses quality issues and coverage gaps in crop insurance provisions.

Purpose – The authors examine framing and narrativization in news coverage of health threats to assess variations in news discourse for known, emerging and novel health risks. Methodology/Approach – Using the analytical categories of known, emerging, and novel risks the authors discuss media analyses of anti-vaccination, antimicrobial resistance (AMR), and Covid-19. Findings – Known risks are framed within a biomedical discourse in which scientific evidence underpins public health guidelines, and following these directives prevent risk exposure while non-compliance is characterized as immoral and risky. News coverage of emerging risks highlights public health guidelines but fails to convey their importance as the risks seem too distant or abstract. Media coverage of novel risks is characterized by the ubiquity of uncertainty, which emerges as a “master frame” under which all incidents and events are subsumed. Stories about novel risks highlight the fluid and changing nature of scientific knowledge, which has the unintended effect of fueling uncertainty as studies and experts contradict each other. Originality/Value – This chapter introduces a new analytical framework for examining how media stories represent public health risks, along with previously unpublished analysis of media coverage about AMR and Covid-19. This chapter provides insight about the nature of risk discourses involving media, public health officials, activists, and citizens.

To describe and analyze a proposed rule recently issued by the US Securities and Exchange Commission (“SEC”) that would overhaul the use of derivatives and financial commitment transactions by registered investment companies and business development companies.

This article summarizes the various aspects of the proposed rule, discusses the elements of the proposed rule in greater detail, explains the effect of the proposed rule on existing guidance from the SEC and its staff, and notes the potential transition period for any final rule.

While the proposed rule is subject to public comment and subsequent consideration by the SEC and its staff, if the proposed rule is adopted in its current form it would result in sweeping changes for registered investments companies and business development companies.

This article contains a detailed overview of a recent SEC rule proposal regarding the use of derivatives by registered investment companies and business development companies and practical guidance from experienced asset management lawyers.

This study aims to analyze and assess 21 years of media coverage (2000–2020) of Flix, a small industrial village located in an rural area on north-eastern Spain, which has endured in these years a severe environmental and industrial crisis, with a strong potential for stigmatization of the place.

The research is conceptualized under the Social Amplification of Risk Framework, a theoretical/conceptual approach aimed at accounting for the huge gaps that often arise between public perception of technological or environmental risks of some technologies, products and places and the expert estimations of these risks. The authors studied the coverage on Flix by a local, a regional and a national newspaper through a content analysis where the corpus (1,524 news pieces) was coded for several variables, including tone, genre and thematic area.

The studied coverage was in general overwhelmingly negative and strongly focused on “bad news” relating to pollution and deindustrialization, although this was much less the case in the local newspaper than in the regional and, in particular, the national newspaper. Thus, a territorially escalated pattern clearly emerges from our research concerning the stigmatization potential of news media coverage for the specific case under scrutiny.

To the authors’ knowledge, this is the first time such a longitudinal study of media coverage and its potential for place stigmatization is performed with this specific territorial perspective.

This study aims to empirically investigate the effect of International Financial Reporting Standards (IFRS) convergence on corporate risk disclosure, with a particular emphasis on the quantity and coverage of risk information. The research also conducts economic benefit and cost analysis to investigate the economic implications that may arise from the transition to IFRS reporting.

A content analysis approach is used to measure two broader dimensions of risk disclosure, namely, risk disclosure quantity and risk topic coverage. Furthermore, using firm-fixed effect regression on a sample of 143 Indian-listed companies, this study investigates the variations in these risk disclosure dimensions before (2012–2016) and subsequent to (2017–2021) the convergence with IFRS.

The empirical results of this research demonstrate that IFRS convergence has led to a significant improvement in firms’ risk disclosure across several dimensions. Particularly, during the post-IFRS period, firms’ usage of risk-related words and sentences has considerably surged in MD&A, Notes and whole annual reports. In addition, upon IFRS convergence, firms’ risk descriptions have become more extensive and evenly distributed across risk topic categories. Moreover, the in-depth benefit and cost analysis revealed that firms reporting under IFRS benefit from decreased cost of equity capital, but they also incur a higher cost of audit fees.

This study contributes to the literature in two ways. First, this is the only study, to the best of the authors’ knowledge, to conduct a broader examination of the impact of mandatory IFRS convergence on corporate risk disclosure, with a major focus on quantity and coverage of risk information. Second, by conducting economic benefit and cost analysis, this study provides novel insights into the critical role of IFRS risk disclosures toward multiple economic outcomes.

Many U.S. companies fear investing in Third World countries because of the political risk associated with such ventures. Recent events in Iran, Nicaragua, El Salvador, the Philippines and others have under scored such concerns, making U.S. businesses reluctant to participate in some of the fastest growing markets in the Third World. Such political risks need not be so worrisome ‐ many U.S. business people remain unaware of how the Overseas Private Investment Corporation can substantially reduce risks by insuring companies against such uncertainties. This paper discusses the ways through which OPIC can alleviate political risk and compares OPIC’s insurance with the programs of private political risk insurers.

Whether financial analysts play an effective role as information intermediaries and monitors has triggered a wide spread of debate among academics and practitioners to date. The purpose of this paper is to complement this debate by investigating the association between analyst coverage and firm-specific future stock price crash risk.

Regression analysis is based on a large sample of US public firms and the crash risk measure of Hutton et al. (2009). Potential endogeneity concerns are alleviated by restricting the sample period to the post-Regulation-FD period and conducting an analysis of the impact threshold for a confounding variable method per Larcker and Rusticus (2010).

Evidence reveals that a high level of analyst coverage is associated with lower future stock price crash risk. Furthermore, the negative association between analyst coverage and stock price crash risk is stronger for firms that have high financial opacity. Additionally, analyst forecast pessimism is negatively associated with future crash risk.

Our research provides evidence in support for the view that financial analysts play an active information intermediary role in a way that increases information transparency of a firm and reduces its crash risk. Also, our study offers support for the view that analysts perform an effective monitoring role in a way that constraints management’s bad news hoarding activities and reduces future crash risk.

This study is of interest to investors who seek analyst reports for their investment decision making and for information providers who demand external financing. The findings of this study also have some other important implications for practitioners, given the economic and welfare consequences of stock price crashes.

This study offers support for the view that analysts serve positive roles as information intermediaries and monitors in the US stock market.

Insurance is a contract whereby one party (the policyholder) promises and makes a payment or series of payments in exchange for the second party’s (the insurance company’s) promise to indemnify the policyholder for losses covered under the terms of the policy. Perhaps it is easier to just think of insurance as a transaction where the policyholder trades small regular losses (the premium paid) for large and irregular gains (claims proceeds).

While it may seem somewhat disproportionate to devote an entire chapter to more detailed treatment of a single risk financing tool, insurance has a very large impact, not only in terms of its intrinsic value, but also in terms of the many ways in which insurance influences risk management thinking and practice. As will be shown, some of this influence is waning and in other cases it could be argued that insurance ‘thinking’ has hindered efforts to respond to facts on the ground and the ability to adapt the role of risk management in organisations.

To provide a useful discussion, this chapter will cover both the products that the insurance industry offers and the structure of the industry itself, along with addressing legal and regulatory matters that were touched upon in Chapter Nine. The chapter concludes with an overview of public sector insurance issues that provides a basis for understanding alternatives to insurance that have emerged in dramatic fashion in recent decades – which in turn provides a basis for considering some of the constraints that insurance imposes on risk management practice.

The purpose of this paper is to examine novel corporate governance-based determinants of risk disclosures among index-listed Finnish companies. Therefore the focus of the study is on explaining the board’s monitoring role in relation to corporate managers.

Firms’ risk disclosures are analysed in terms of their Quantity and Coverage. The authors focus on two board characteristics not examined in prior related literature: first, non-executive board members’ self-interested financial incentives, measured by their share or option ownership, and annual compensation and second, non-executive board members’ competence, measured by their experience in the company and managerial capability proxied by prior education. The sample is composed of the OMXH-25-listed firms, representing the most traded and followed firms among Finnish publicly listed companies.

The authors find that the risk disclosures of these firms can be explained by financial incentives (wealth and compensation) and competence-related factors (attrition rate and education). The results indicate that among the “best disclosers”, the narrative risk disclosures are, on average, on a high level, and variation in risk reporting is largely associated with board characteristics.

The relatively small sample size makes the results vulnerable to type two error. Further research could continue by examining the impact of board work on corporate disclosures across countries and disclosure items.

Board members’ financial incentives and competence impact the dynamism of board work. In this way, they are also associated with board members’ disclosure decisions.

This paper contributes to the extant literature by demonstrating the impact of previously unexamined board characteristics on the quality of the narrative risk disclosures of highly followed firms.