The Inevitability of Financial Risks in Businesses and How to Overcome Them: Saudi Arabia in Focus

Lasloom, Nasser Mohammed

doi:10.1007/978-981-16-0953-4_79

Cited by 1 publication

(1 citation statement)

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“…This research is based on the following work in the sphere of financial risk management in entrepreneurship: Bakos and Dumitras , cu (2021), Bouri et al (2021), Dalwai and Salehi (2021), Duygun et al (2020), Elkhal (2019), Lasloom (2021), Locurcio et al (2021), Sabău et al (2021), and Syed and Bawazir (2021).…”

Section: Theoretical Basis Literature Review and Gap Analysismentioning

confidence: 99%

Dataset Modelling of the Financial Risk Management of Social Entrepreneurship in Emerging Economies

Popkova

Sergi

2021

Risks

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The relevance of this study lies in the fact that financial risk is a serious obstacle to the development of social entrepreneurship, preventing the implementation of potential support for sustainable development goals in business. The purpose of this article is to clarify specific aspects of financing factors and financial risk related to social entrepreneurship in developing countries (in comparison with the standard financial risk related to commercial entrepreneurship) in order to analyze the influence of the financing factors of social entrepreneurship on sustainable development, as well as to determine the potential for the development of social entrepreneurship through financial risk management. To achieve this goal, this article uses the methodology of econometrics—dataset modelling of financial risk management in social entrepreneurship to achieve sustainable development in emerging economies. On the basis of the results of this study, firstly, it is substantiated that the financial risks entailed by social entrepreneurship differ from the standard financial risk present in commercial entrepreneurship. Specific factors of the financing of sustainable development in emerging economies are determined and, on the basis of this, financial risks specific to social entrepreneurship in emerging economies are identified as follows: (1) reduced stimulus to use financial resources in long-term investments, which disrupts the stability and decreases inclusion; (2) joint public–private investments and decreased investment in R&D; and (3) expanded investment in the skills required for jobs and “markets of tomorrow”. Secondly, a contradictory influence of financing factors on sustainable development is demonstrated. Thirdly, a large potential for the development of social entrepreneurship by means of financial risk management (maximum reduction) was identified. With the minimization of financial risk, social entrepreneurship would demonstrate substantial progress, with an increase of 99.61% (more than 50%) from 45.18 points to 90.18 points. A novel contribution of this paper to the extant literature consists of the specification of the essence and specifics of social entrepreneurship in emerging economies through the identification of financial risks and the provision of recommendations for their management.

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