+44-7897-074717Rapid Communication - Journal of Research in International Business and Management ( 2025) Volume 12, Issue 6
Published: 27-Dec-2025
International corporate risk governance refers to the structures, policies, and processes through which multinational firms identify, assess, and manage risks across global operations. This study examines the role of risk governance in addressing strategic, operational, financial, and compliance risks in international business environments. It explores governance frameworks, board oversight, and enterprise risk management systems. The paper highlights challenges related to cross-border regulatory diversity, geopolitical uncertainty, and risk interdependence. It also discusses the importance of transparency, accountability, and risk culture. By integrating corporate governance and international management perspectives, this study emphasizes that effective international corporate risk governance enhances resilience, stability, and sustainable global performance.
International Corporate Risk Governance, Enterprise Risk Management, Global Risk Management, Corporate Governance, Business Uncertainty, Multinational Enterprises
International corporate risk governance has become increasingly important as multinational enterprises operate in volatile and interconnected global environments. Globalization exposes firms to diverse risks, including economic instability, political uncertainty, regulatory changes, and operational disruptions. Effective risk governance frameworks enable organizations to anticipate, manage, and respond to such uncertainties (Brown et al., 2009) . Risk governance supports strategic resilience and long-term sustainability. The complexity of international business amplifies risk exposure for multinational firms. Operating across multiple jurisdictions requires compliance with varying legal systems, regulatory standards, and cultural norms. These differences increase uncertainty and coordination challenges. Structured risk governance mechanisms provide clarity and control in complex environments (Renn & Walker, 2008).
Board oversight plays a critical role in international corporate risk governance. Boards of directors are responsible for setting risk appetite and ensuring appropriate risk management practices. Strong board engagement enhances accountability and strategic alignment. Governance leadership strengthens risk oversight. Enterprise risk management systems form the foundation of effective international risk governance. ERM frameworks integrate risk identification, assessment, and mitigation across organizational functions and geographies. Integrated risk management improves visibility and coordination. ERM supports informed decision-making (Clarke, 2007).
Geopolitical risks significantly influence international corporate risk governance. Trade conflicts, sanctions, political instability, and policy changes affect global operations. Firms must continuously monitor geopolitical developments (Aguilera et al., 2019). Proactive governance reduces exposure to political risk. Financial risks, including currency volatility and capital market fluctuations, present major challenges for multinational enterprises. Risk governance frameworks support financial risk assessment and hedging strategies. Effective financial governance enhances stability. Financial discipline supports performance.
Operational risks related to supply chains, technology, and human resources have intensified in global business contexts. Disruptions in one region can affect global operations. Risk governance promotes contingency planning and resilience. Preparedness strengthens operational continuity.
Compliance and ethical risks are central to international corporate risk governance. Firms must adhere to international laws related to anti-corruption, data protection, and environmental standards. Robust compliance systems reduce legal exposure. Ethical governance builds stakeholder trust.
Risk culture influences the effectiveness of governance frameworks. Organizations that promote transparency, accountability, and risk awareness enable better risk management. Leadership commitment fosters strong risk culture. Culture shapes behavior (Strange et al., 2009).
Overall, international corporate risk governance is a strategic capability that enables multinational enterprises to manage uncertainty and complexity in global markets. Firms that invest in robust governance structures, risk management systems, and ethical leadership are better positioned to achieve sustainable international success.
International corporate risk governance plays a vital role in managing uncertainty and protecting multinational enterprises from global risks. This study highlights that board oversight, enterprise risk management, and strong risk culture enhance organizational resilience. Firms with effective risk governance frameworks are better equipped to sustain long-term global performance.
Aguilera, R. V., Marano, V., & Haxhi, I. (2019). International corporate governance: A review and opportunities for future research. Journal of International Business Studies, 50(4), 457-498.
Indexed at, Google Scholar, Cross Ref
Brown, I., Steen, A., & Foreman, J. (2009). Risk management in corporate governance: A review and proposal. Corporate Governance: An International Review, 17(5), 546-558.
Indexed at, Google Scholar, Cross Ref
Clarke, T. (2007). International corporate governance: A comparative approach. Routledge.
Renn, O., & Walker, K. (2008). Global risk governance. Concept and practice using the IRGC framework. Dordrecht, 77-86.
Strange, R., Filatotchev, I., Buck, T., & Wright, M. (2009). Corporate governance and international business. Management International Review, 49(4), 395-407.