COMPARISON OF RISK MANAGEMENT REGULATION FROM A CORPORATE GOVERNANCE PERSPECTIVE WITHIN THE GERMAN AND UNITED STATES LEGAL AREAS

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Abstract

Risk management is one of the main corporate governance components or management tasks. This paper details a comparison of risk management regulation from a corporate governance perspective of listed stock corporations in Germany and the United States (U.S.). Obviously, there are differences and commonalities between the national legal norms and the regulatory levels of risk management in both countries. The comparison helps to understand different traditions and practices in terms of how significant corporate governance rules are for risk management. Therefore, this article intends to inspire future research on the regulation of risk management across different regions and explore the relevance of national interests in the regulation of risk management. A principal finding of the comparison is that the U.S. corporate governance system seems to be more strongly regulated than the German system. This results from the powerful and coordinating role of the U.S. Securities and Exchange Commission (SEC). Thus, the seemingly more liberal system of non-binding standards in the U.S. has a higher impact on the regulation of risk management than in Germany.

Key Words: Risk Management, Regulation, Corporate Governance, Germany, US, Legal Area

How to cite this paper: Sassen, R. (2014). Comparison of risk management regulation from a corporate governance perspective within the German and united states legal areas. Journal of Governance and Regulation, 3(4-1), 138-148. https://doi.org/10.22495/jgr_v3_i4_c1_p6