Finance, Risk Management, and Corporate Governance

Introduction:

The Corporate Governance and Risk Management course is designed to provide an in-depth understanding of finance, risk management, and corporate governance. It explores the crucial role of capital markets in the context of globalization and their importance for societal functionality. Given their central role, ensuring their effective operation and oversight is essential.

This course investigates the complex interactions between management and corporate stakeholders, addressing the challenge of balancing competing demands for resources and strategic planning. Key elements include financial risk management tools and systems, business risk in financial management, and strategies for managing corporate financial risk.

Objectives:

By the end of this Corporate Governance and Risk Management course, participants will be able to:

• Define the purpose and limits of corporate financial statements’ framing.
• Explain concepts, rules, and procedures for evaluating corporate financial reporting.
• Understand the influence of working capital on market processes.
• Examine the effects of capital structure on firm performance.
• Recognize the impact of poor capital budget forecasts on business performance.
• Identify challenges in corporate finance, reporting, and governance.
• Assess financial risk in project management and decision-making.
• Develop competencies in finance and governance.
• Contribute effectively to finance and governance decisions.
• Appreciate the role of continuing education in finance and governance.
• Gain recognition for their professional development.
• Navigate a challenging learning environment.
• Integrate business plans with strategic objectives to reduce inter-functional conflicts.

Training Methodology:

• Case Studies
• Group Discussions
• Interactive Workshops
• Simulations
• Role Playing

Course Outline:

Unit 1: Finance & Working Capital – Liquidity or Bankruptcy

• The essence of money in finance.
• Beyond figures: aspects of finance.
• Definition and components of working capital.
• Key ratios for evaluating working capital.
• Strategies for managing working capital.

Unit 2: Capital Structure

• Importance and elements of capital structure.
• Defining equity capital and its cost/required return.
• Understanding capital debt and its value/expected return.
• Weighted Average Cost of Capital (WACC) and its application.
• Leverage: operational and financial considerations.

Unit 3: CAPEX – Investment Analysis and Decision-Making

• Evaluating capital projects: cash flows and time.
• Methods: Net Present Value (NPV), Internal Rate of Return (IRR), Profitability Index (PI), and Modified Internal Rate of Return (MIRR).
• Capital project post-implementation reviews.
• Addressing risk and changing circumstances in investment analysis.

Unit 4: Risk Assessment Methods within Corporate Governance

• Awareness of risk, uncertainty, and opportunity.
• Strategic, operational, and functional financial risks.
• Developing a Financial Risk Management (FRM)/Enterprise Risk Management (ERM) strategy.
• Various risk types: growth, R&D, outsourcing, legal, environmental, and more.

Unit 5: Corporate Governance

• Impact and importance of corporate governance.
• Governance environment and structures.
• Shareholders versus stakeholders.
• Governance mechanisms: board structures, chairman/CEO duality, and independent directors.
• Modern developments in corporate governance and agency theory.