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People Value at Risk: A Key Indicator for Sound Management


  • Jose Manuel Feria-Dominguez

    () (Department of Financial Economics and Accounting, Universidad Pablo de Olavide)

  • Enrique Jimenez-Rodriguez

    () (Department of Financial Economics and Accounting, Universidad Pablo de Olavide)

  • Pilar Camacho-Rubio

    () (Department of Financial Economics and Accounting, Universidad Pablo de Olavide)


People are the most important asset for companies, but they are also a source of risk. People risk involves both intentional and unintentional people’s behavior that could provoke losses for firms. The main goal of this paper is twofold: to identify four different risk categories (Internal Fraud, Employment Practices and Workplace Safety, Clients, Products and Business Practices and Execution, Delivery & Process Management) that are “people-related”, and to measure the people risk exposure by applying the concept of People-Value at Risk (People-VaR) as a new key-indicator for sound management in the financial sector. Then, we also calculate the Risk Adjusted Return on Capital (RAROC) to evaluate the bank’s risk-adjusted performance, being both measures useful tools for monitoring the shareholder’s value creation

Suggested Citation

  • Jose Manuel Feria-Dominguez & Enrique Jimenez-Rodriguez & Pilar Camacho-Rubio, 2014. "People Value at Risk: A Key Indicator for Sound Management," Working Papers 14.03, Universidad Pablo de Olavide, Department of Financial Economics and Accounting (former Department of Business Administration).
  • Handle: RePEc:pab:fiecac:14.03

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    References listed on IDEAS

    1. Dahen, Hela & Dionne, Georges, 2010. "Scaling models for the severity and frequency of external operational loss data," Journal of Banking & Finance, Elsevier, vol. 34(7), pages 1484-1496, July.
    2. Cameron, A. Colin & Trivedi, Pravin K., 1990. "Regression-based tests for overdispersion in the Poisson model," Journal of Econometrics, Elsevier, vol. 46(3), pages 347-364, December.
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    More about this item


    People Risk; People-Value at Risk; Risk Adjusted return on Capital (RAROC); Banking performance;

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