Behavioural Risk Management
Discipline: Operational Risk
Virtually every major risk management failure that made the headlines in recent years can be attributed to psychological pitfalls. As a result, behavioural economists are now addressing human behaviour in all economic analyses, including limited rationality, irrational choices and human biases. It is crucial that risk professionals get to grips with this hugely important area so they can address these risks in their decision making and improve risk management strategies.
Behavioural Risk Management, by Risk Books bestselling author René Doff, takes into account the latest economic insights and applies them to the day-to-day practice of managing risk. Covering the theoretical foundation as well as the practical applications, Doff acknowledges that the world around us is changing rapidly with complex and interacting developments and that this requires different tools to those that were used in the past. System analysis and scenarios are much better equipped than stochastic models to prepare the risk manager for the future.