Risk governance: exploring the role of organisational culture

Abstract

Purpose This study aims to investigate the association between organisational culture (OC) and the extent to which risk governance (RG) practices are implemented in Qatar. Design/methodology/approach It relies on the institutional theory and OC perspectives to generate testable hypotheses and explain the empirical findings, using data from 85 Qatari firms collected based on questionnaires. It also applies ordinary least squares regression to examine the associations between five OCs (innovation, outcome orientation, attention to detail, team orientation and tight versus loose control) and the level of implementing RG practices, whilst controlling for the presence of internal audit (IA), firm size, listing status, type (private/government) and sector (financial/non-financial). Findings An OC of “tight control”, the presence of an IA and being a private firm are significantly associated with implementing RG practices. An OC of teamwork is negatively associated with RG practices. Practical implications Policymakers and corporate managers are encouraged to set guidelines governing the formation of cohesive cooperative teams within organisations. They must develop strategies that promote the “risk culture” as a major component of OC. Policymakers should also monitor the culture and institutional forces behind the successful implementation of RG that involves the collaboration of employees at different organisational levels. Originality/value To the best of the authors’ knowledge, this study is novel because it empirically examines the OC–RG relationship in an emerging market economy (Qatar).

Guest editorial

“…This literature has thus far used firms from the financial service industry and samples from developed countries. The article by Hassan et al (2022) therefore complements existing risk culture studies by offering evidence from a mixed sample of financial and nonfinancial firms in an emerging economy.…”

“…The survey study by Hassan et al (2022) further adds to this line of thinking. It analyzes whether elements of organizational culture are related to the adoption of risk governance practices.…”

“…Besides the presence of an internal audit department in firms and private ownership, the results presented by Hassan et al (2022) show that an organizational culture marked by tight control and little teamwork is also related to higher rates of adopting risk governance practices. Since both these aspects of organizational culture could also be seen as elements of cultural controls (Goebel and Weißenberger, 2017;Malmi and Brown, 2008;van der Kolk et al, 2019), the study by Hassan et al (2022) delivers further evidence of the interplay between management control systems and risk governance/risk management systems. In addition, it adds to the growing literature on how risk culture shapes organizational risk management practices (for reviews, see Cimini, 2021;Kunz and Heitz, 2021).…”

“…The seven articles in this issue cover a wide range of notions about how risk governance and risk management can evolve over time and how such developments interact with organizational change. Methodologically, the seven papers are based on several data generation approaches such as in-depth case studies (Murr and Carrera, 2022;Tica and Weißenberger, 2022), archival data (Nagel et al, 2022), survey data (Hassan et al, 2022;Schäfer et al, 2022), a combination of survey and interview data (Tan and Lee, 2022) and agent-based modeling (Harten et al, 2022). At the same time, the articles rely on data from across the world such as Germany (Tica and Weißenberger, 2022;Schäfer et al, 2022), Malaysia (Tan and Lee, 2022), Saudi Arabia (Murr and Carrera, 2022), the USA (Nagel et al, 2022) and Qatar (Hassan et al, 2022).…”

“…Methodologically, the seven papers are based on several data generation approaches such as in-depth case studies (Murr and Carrera, 2022;Tica and Weißenberger, 2022), archival data (Nagel et al, 2022), survey data (Hassan et al, 2022;Schäfer et al, 2022), a combination of survey and interview data (Tan and Lee, 2022) and agent-based modeling (Harten et al, 2022). At the same time, the articles rely on data from across the world such as Germany (Tica and Weißenberger, 2022;Schäfer et al, 2022), Malaysia (Tan and Lee, 2022), Saudi Arabia (Murr and Carrera, 2022), the USA (Nagel et al, 2022) and Qatar (Hassan et al, 2022). The geographical spread of the data used in the articles signals that new and changing approaches to risk governance and risk management are relevant in many countries, but are, at the same time, influenced by national regulations and idiosyncratic pressures (Alsharari, 2021;Haustein and Lorson, 2021;Maffei and Span o, 2021;Murr and Carrera, 2022;Rana et al, 2019a;Schäfer et al, 2022;Tica and Weißenberger, 2022).…”