Behavioral Risk Management

Psychological skills to complement quantitative techniques

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Next available date: 19 September

Effective risk management involves a combination of quantitative and qualitative skills. Qualitative skills do not substitute, but instead complement and support quantitative skills. The Behavioral Risk Management course presents a framework for managing risks that relate to human psychology. In this regard, virtually every major risk management failure, if not catastrophe, in recent years has had psychological pitfalls at its root.

If you are responsible for risk management or wish to have a better awareness of risks within your organization, if you interact with risk managers, or if you are a risk manager yourself, then this program will help you better understand the psychology of risk. At its core, the psychology of risk pertains to emotions, framing, personality, and judgmental errors. Through this program, you will acquire a vocabulary and skill set for analyzing the psychological dimension of risk management issues, thereby improving your effectiveness and the efficacy of your organization.

How you will benefit

  • Learn to identify how psychological hard wiring predisposes people to make systematic mistakes in the assessment and taking of risk
  • Be able to assess and describe how risk management culture determines levels of operational risk
  • Measure the reflection of sentiment in pricing and its connection to value and risk
  • Understand how behavioral frameworks can be used to foster a risk management mindset for all professionals within the organization
  • Build a behavioral toolkit through the use of case studies during the program

Program length
2 days

Day 1 09:00 – 17:00
Day 2 09:00 – 17:00

Psychological foundations: vocabulary, concepts, and techniques

  • Heuristics
  • Biases
  • Framing effects and reference-point risk preferences
  • Mitigation approach using nudges, fast and frugal techniques

Financial instability, systemic risk, psychological dimension of global financial crisis

  • Financial Instability Hypothesis
  • Systemic risk
  • Global financial crisis, case studies
  • Regulatory heuristics

Risk management in financial firms and regulatory agencies: case studies

  • JPMorgan Chase, OCC
  • MF Global, CFTC/SEC
  • RBS, Fortis, Santander/ABN AMRO, FSA/DNB
  • Madoff, SEC
  • UBS

Risk management in operating firms and regulatory agencies: case studies

  • Fukushima Daiichi, NISA
  • Southwest Airlines, FAA
  • BP, MMS
  • GM, NHTSA
  • Nortel Networks

If you are responsible for risk management or wish to have a better awareness of risks within your organization; if you interact with risk managers, or if you are a risk manager yourself, then this program will help you better understand the psychology of risk.


Faculty

Hersh Shefrin

Hersh Shefrin is the Mario L. Belotti Professor of Finance at Santa Clara University. He is one of the pioneers in the behavioral approach to economics and finance. The January 2001 issue of CFO magazine listed him among the academic stars of finance. A 2003 article in the American Economic Review listed him as one of the top fifteen…

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  • 2 days
  • € 2500
  • Risk Management
  • English
  • NEW

Available dates

Need help?

Find your program here or contact us directly for personal advice:
Call us at +31 20 520 0160 or email us at [email protected].

Program flyer

For a more detailed program description and information regarding faculty please download the program document.



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