Effectiveness of Risk Management in the MSME Sector: A Pilot Study
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Abstract
Enterprise Risk Management (ERM) is now accepted as an integral part of the organizational matrix in the MSME sector. While a lot of research has been undertaken in the field of risk management by financial institutions, very little effort has been made within India to understand the overall risk scenario in this sector. As MSMEs are the backbone of the economy, their sustained growth has always been the top priority of every government in the world. Due to their low capital base, inability to invest in technology, centralized decision-making, and lack of a structured ERM framework, the organizations have always been struggling and are observed to be highly susceptible to risks and vulnerable to business disruptions. Though ERM is in a nascent stage in India, it is widely practiced and the MSME sector, due to its exposure to the global marketplace, is no exception to it. This paper is a pilot study to understand the effectiveness of ERM and forms a part of the main study in the same area.
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References
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