Risk Management: Business Risks and Unethical Behavior in Projects

This report examines the four main categories of business risk: strategic, compliance, operational, and financial risk. It provides detailed explanations of strategic and compliance risks, emphasizing their significance in business planning and regulatory adherence. The report also addresses the risks associated with unethical behavior in organizations, particularly within project management. It discusses how unethical practices, such as incorrect project reports and violations of laws, can lead to project failure, financial losses, and damage to a company's reputation. The analysis underscores the importance of ethical conduct in maintaining client trust and achieving project success, highlighting the need for organizations to identify and mitigate unethical behaviors effectively to ensure project integrity and overall business success. References from various academic journals and books support the analysis.

Running head: RISK MANAGEMENT IN PROJECTS
RISK MANAGEMENT IN PROJECTS
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Table of Contents
Question 1..................................................................................................................................2
Question 2..................................................................................................................................3
References..................................................................................................................................5

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Question 1
What are the four main categories of business risk, Discuss and elaborate on two of
them?
Most of the businesses faces different types of risks that may decrease their level of
efficiency to achieve the goals as set by the organization handling the business. The four
significant business risks that may be identified within any business are depicted to be
Strategic Risks, Compliance Risks, Operational Risk and lastly the Financial Risk. The two
significant risks are briefly stated below:
 Strategic Risk: The significant success of a business depends on the fact of the
efficient business planning. If the plan is not enhanced in association to the business
then it is depicted to be a failure and the significant situation is stated to be a strategic
risk. Facing such type of risk is not disastrous at times but there has to be a significant
importance that is to be provided in regards to this risks when the overall planning is
carried out regarding a business (Harris, 2017). This risk are very important in regards
to their mitigation as without its mitigation a business may not achieve their strategic
scope as well as goals as set within their business plan.
 Compliance Risk: This situation leads to the risks that are associated with the fact that
a business is not following the necessary rules and regulations as well as the laws that
are needed for a business to carry out the smooth execution of the overall business.
Moreover, this risks also tends to decrease the certain level of the company’s
reputation as well as tends to affect the future of the business, thus hampering their
customer market and further putting a negative impact within their business trends
(Sadiq & Governatori, 2015).

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Question 2
What are the risks of implementing unethical behavior in an organization on the
management of projects?
The risks associated with the implementation of the unethical behavior by an
individual or group of some individuals may lead the organization to face a huge amount of
risk and this may lead the organization fail to meet their strategic goals thus hampering their
customer base as well as incur huge amount of financial loss (Thau et al., 2015). The first risk
that may be significantly identified are the incorrect project reports that indicates strategic
risks. The incorrect project report may misguide the path of success thus leading the
organization not to cope with the set strategic goals of the organization. In addition to this the
compliance risk such as violation of a law or right by a leader present within the organization
may lead the organization to lose their dignity in the market as well as decreasing the
organization’s reputation within the industrial market. Moreover the experts, or the managers
as well as the leaders that are present within the organization turns to use unethical means
such as giving personal information of the company to some other competitor company for
money, will lead the organization to face a downfall as the competitor will be much
benefitted (Askew, Beisler & Keel, 2015). This type of risk is also associated with the
financial loss of the organization. Thus risk falls under the category of the financial risks.
This type of behavior also emphasizes on the factor of adhering adverse effects within the
overall operations in an organization.
The overall operation if hampered then the organization will lose their functional
capability regarding their projects thus making the project to stop thus leading to the failure
of the project (Kaptein, 2017). The projects within an organization are very important in
regards to the overall success of the organization. Moreover, the implementation of the
unethical behavior within the projects will also lead to the decrease of the client trust those

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provide the project. Thus the organization must take effective steps in accordance to the
identification of the unethical behavior as well as mitigate them as it is depicted within a
project. The implementation of the unethical behavior by the leaders within an organization
leads to the decrease down of the performance that are associated with the overall execution
of the project. Once the project performance is hampered the overall project tends to fail
(Halinen & Jokela, 2016). The projects that are carried out by an organization leads the
project’s success. Ethical behavior within an organization may lead it to great success within
the market fields. Lastly it can be said that a minute enactment of the unethical behavior
within an organization’s project then it intends the project to fail thus leading to the
organizational failure of it.

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References
Askew, O. A., Beisler, J. M., & Keel, J. (2015). Current trends of unethical behavior within
organizations. International Journal of Management & Information Systems
(Online), 19(3), 107.
Halinen, A., & Jokela, P. (2016). Exploring ethics in business networks: Propositions for
future research. In Extending the Business Network Approach (pp. 333-356). Palgrave
Macmillan, London.
Harris, E. (2017). Strategic project risk appraisal and management. Routledge.
Kaptein, M. (2017). The battle for business ethics: A struggle theory. Journal of Business
Ethics, 144(2), 343-361.
Sadiq, S., & Governatori, G. (2015). Managing regulatory compliance in business processes.
In Handbook on Business Process Management 2 (pp. 265-288). Springer, Berlin,
Heidelberg.
Thau, S., Derfler-Rozin, R., Pitesa, M., Mitchell, M. S., & Pillutla, M. M. (2015). Unethical
for the sake of the group: Risk of social exclusion and pro-group unethical
behavior. Journal of Applied Psychology, 100(1), 98.