Risk Management and Corporate Sustainability in Aviation by Flouris Triant G. Kucuk Yilmaz Ayse. & Ayse Kucuk Yilmaz

Author:Flouris, Triant G.,Kucuk Yilmaz, Ayse. & Ayse Kucuk Yilmaz
Language: eng
Format: epub
Publisher: Taylor & Francis (CAM)
Published: 2011-04-14T16:00:00+00:00

Figure 5.4 Effective risk management model for the airline industry

Source: Protiviti, Inc., 2008.

cultures, risk appetites, and financial resources. Thus, the specific approaches, processes, methodologies, systems, and metrics that define the solution will differ from company to company (Protiviti, 2008).

The sustainability-based management model is needed for the air transportation industry to survive. This industry has many and various risks. In actuality, the nature of aviation has a fundamental risk: flight. The Corporate Sustainability Management model is developed and improved according to the characteristics in the implementation process. This model offers a flexible basic process model.

In this part of the book, Protiviti’s effective risk management model (see Figure 5.4) is given as a good model sample for the airline industry. This model’s context may be useful for the understanding and implementation of the Corporate Sustainability Management model.

Protiviti’s model for effective risk management is designed to help airline management move beyond traditional risk management to holistic risk management. Traditional risk management focuses on managing uncertainties around physical and financial assets. In comparison with Corporate Sustainability Management and effective risk management, risk may also be viewed as a positive (opportunity) since the objective of a risk management managerial approach and its system is not only to protect but also to create and enhance enterprise value (see Figure 5.5). With this approach, risk management is embedded in the company’s strategy and is managed at the top of the organization (Protiviti, 2008).

The airline industry has more complicated and dynamic qualifications which requires implementing Corporate Sustainability Management (Protiviti, 2008). The new model can be a strong support for implementing a truly and holistically enterprise-wide approach across all of corporate operations. This approach cannot be fully implemented among corporations in other industries. According to the Oliver Wyman survey, one of the world’s fastest growing airlines is facing significant challenges and new risks, due to the following (Oliver Wyman, 2007):

• increased competition;

• fuel price increases;

• post-merger integration issues;

• possible regulatory changes and market liberalization.

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.