Whitepaper: Measuring RoI on Risk Management

This is (arguably) one of the World’s first White papers on RoI on Risk Management for Energy / Commodity companies. In this White Paper, we discuss the Returns that can be achieved from investments in Risk Management. We present a model to measure RoI on Risk Management that can be easily customized and applied to any company. We also introduce a new Ratio ERR (Excess Risk Ratio) that uses Expected Shortfall (ES) and Value-at-Risk (VaR) to arrive at the Returns from Risk Management. The paper draws upon observations of ERR from different commodities.

To learn more about Expected Shortfall (ES), read our blog post “Commodity Risk Management Beyond VaR“.

We start with putting the problem in context, and understanding why measuring Returns on RM is so difficult. We also look at related / similar studies in other sectors (Banking and Financial Institutions).

Our results indicate that the RoI for Risk Management for Energy / Commodity Companies is in the range of 3.2% – 14% of average Portfolio Value.

If you would like to read this White Paper, please fill in the form on the side and we’ll send send it across to you within the day !

Please note that our Publications are shared selectively only with people from Energy / Commodity / Banking / Financial Services companies. We frequently get requests from generic domains (like gmail, yahoo, etc.) and sometimes, despite our best efforts to verify identities of these people, we are unable to do so. Such requests unfortunately have to be declined. So we would request you to use your official email id for downloading our publications – and be assured that you’re in good company !

Download Requests from vendors / consultants are also taken up separately, and approved only if there is a viable business case for doing so. Please write in separately to us on info@riskedgesolutions.com – we read and respond to every personalized email !