The Handbook of Corporate Financial Risk Management

Book Preface

The Handbook of Corporate Financial Risk Management has the rare quality of delivering exactly what its title promises.

Over the years, managing financial risks has represented an everincreasing share of the workload of any chief financial officer (CFO), and this is unlikely to reverse any time soon. Our world has become more risky and more complex. This is a fact.

To highlight one example of various financial risks, the figure below illustrates the performance of copper, freight, short-term interest rates and the EURUSD exchange rate, since 1994: Companies around the world are affected by these and numerous other market variables, and risk managers have to tackle them all in order to lessen their impacts on financial results and the financial position of their firm.

Among the many sins closely associated with bankers, one of the most frequently cited is opacity. This book will encourage you to revisit this cliché. Stanley Myint and Fabrice Famery have conducted a thorough analysis of the many financial risks facing companies and, most importantly, of how to identify, measure, reduce or eliminate them. Some are obvious, such as interest risk; some are more intricate, such as the risk of deferred consideration in an M&A transaction, or counterparty risk.

Having spent thousands of days thinking about how to help companies address financial risks that they sometimes have not even identified, about how to present solutions in a clear way that is easy to understand, and about how to outsmart the competition and win advisory mandates from clients, Stanley and Fabrice are now able to deliver this handbook, ie, a book that presents issues and solutions. All are example based and very pragmatic. No chapter is complete before a recommendations paragraph being included.