INTEGRATED FINANCIAL RISK MANAGEMENT SYSTEMS AND THE ROLE OF INSURANCE IN THE CORPORATE SECTOR

Abstract

The article explores the comprehensive management of financial risks in enterprises operating in conditions of economic instability, high market volatility, and uncertainty, highlighting the increasing importance of systematic risk control for ensuring sustainable financial performance and long-term growth. The study aims to identify, characterize, and analyze financial risks, evaluate their potential impact on enterprise operations, and develop a structured model for their effective management. The research methodology combines analytical, comparative, and modeling techniques, enabling a detailed examination of financial operations, assessment of deviations from planned results, quantification of potential losses, and evaluation of risk mitigation strategies. The results reveal that financial risks are inherent and unavoidable in all types of financial activity, arising from uncertainties in managerial decisions, asset and liability management, investment projects, and operational processes. The study demonstrates that systematic identification, evaluation, and neutralization of these risks through preventive measures, diversification, hedging, and insurance mechanisms significantly enhance the resilience and stability of enterprises. A cyclic and iterative model of financial risk management is proposed, ensuring adaptability, continuity, and informed decision-making at both operational and strategic levels. The practical significance of the article lies in providing enterprises with an actionable framework to assess risk exposure, select appropriate risk mitigation instruments, implement preventive and compensatory strategies, maintain financial stability, minimize potential losses, improve competitiveness, and achieve sustainable development. The findings offer managers a reliable tool for integrating risk management into strategic planning and operational control, allowing enterprises to respond effectively to external shocks, market fluctuations, and financial uncertainties, thereby securing long-term economic stability and fostering growth in dynamic and unpredictable business environments.