Risk: The term risk may be traced back to classical Greek rizikon (Greek ριζα, riza).

Risk concerns the deviation of one or more results of one or more future events from their expected value. Technically, the value of those results may be positive or negative. However, general usage tends to focus only on potential harm that may arise from a future event.

Source: Wikipedia

The Risk

Defined as the unexpected potential loss of benefits or the wellbeing of an individual as a result of an adverse event, this term has this negative implication as it is usually associated to danger and harm; however, it is unavoidable when closing a business.

Typical risks of the agricultural and cattle farmer:

1. Production Risks.
   1. Weather.
   2. Biological.
   3. Technological.
2. Price Risks.
3. Political and Institutional Risks.

The following are some of the common risks to all companies:

1. Common Financial Risks:
   1. Market.
   2. Liquidity.
   3. Credit.
2. Legal Risks.
3. Human and Recruiting Risks.
4. Physical Risks to Assets.
5. Operative Risks.

What does Risk Management mean?

Risk Management is a set of actions designed to anticipate the occurrence of adverse events. These actions include:

Strategies

Obligations agreed by the parties in order to create a risk policy that defines business strategies, tolerable risk levels and the person responsible for the reduction of the impact of the risks.

Processes

The systematic approach for the evaluation of different types of risks faced in a comprehensive manner. The key to correctly evaluate risks depends on:

• Risk identification.
• Risk treatment.
• Controls set up.
• Risk monitoring and follow up.

Estructure

The structure is the layout of an organization and how it uses its resources and techniques to carry out its strategies.

Risk Management is a concern for everybody in the organization and needs the involvement of all levels. Its activity is not static as there will always be new different risks in this ever changing environment.