Risk

Risk within the context of international management is an unavoidable aspect of business due to a lack of knowledge relating to a new foreign market on the part of the business entity and uncertainty associated with managerial decisions. While international risk is traditionally understood as relating to environmental uncertainties concerning foreign and unfamiliar environments, it may also be described from the perspective of the individual based on their propensity for risk taking behavior. Managers may be risk averse, risk tolerant or even risk seeking, depending on a range of factors including past experience and the extent of their international business relationships. In this regard, managing international risk involves the consideration of factors both from within and outside of the business entity.