The Impact of Operational Risk Management on the Financial Development and Economic Growth: A Case Study of Saudi SME Companies

Abstract

Project finance is a strong driver of economic growth in low income countries where transaction costs are particularly high. One of the main obstacles covering huge associations today is reviewing and commanding the risks that are generated from the risk operations. Through the representation of a business procedure a lot of oddities, that is, aberrations from the normal succession of occurrences might happen. To warrant that a procedure is still able to carry through its organizational targets, procedure entrants must be able to expose, analyze and prosperously resolve such unusual conditions as they occur. This paper intends to measure the operational risk management effects on the financial development and growth in the Saudi SME companies. Online survey was distributed among 150 employees from different SME companies in Saudi Arabia. The result showed that operational risk management effects have positive effects of the financial development and growth in the Saudi SME companies.

Keywords: Operational risk, risk management, financial development, economic growth