Trading.com Risk Assessment Report: MBA402 Governance Module

This report presents a risk assessment of Trading.com, a fictional company offering investment courses. It utilizes the Risk Exposure Calculator, as outlined in the HBR article, to analyze pressure points related to growth (performance pressure, expansion rate, employee inexperience), company culture (rewards for risk-taking, resistance to bad news, internal competition), and information management (transaction complexity, diagnostic gaps, and decentralized decision-making). The assessment reveals a high-risk profile for Trading.com, emphasizing the need for proactive risk management strategies. The report examines the company's background, identifies specific risks, and evaluates their impact, culminating in a risk score that highlights areas needing immediate attention. The findings underscore the importance of addressing these vulnerabilities to ensure the company's long-term sustainability and success. The report concludes by summarizing the risk analysis, revealing a high-risk level with a score of 25. This report is a valuable resource for students seeking insights into risk assessment and management.

Running head: GOVERNANCE ETHICS AND SUSTAINABILITY
Governance Ethics and Sustainability
Name of the Student:
Name of the University:
Author Note:

1GOVERNANCE ETHICS AND SUSTAINABILITY
EXECUTIVE SUMMARY
The primary concern of this report is to analyse the risk management and assessment theory
with the help of the researches and case study about a company named Trading.com. In this
connection, the report focuses on the examination of the risk and the level of the same
concerning the company of Trading.com with the help of the Risk Calculator Analysis. The
report focuses on undermining the background of the concerned company. Further, the report
details the risks that the company faces and the points of pressure related to the same. After
the examination of the level of the risks, the report finally concludes with the summing up of
the score of the risk analysis. In this connection, the report investigates that the company is at
a danger level with a high score of 25.

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Table of Contents
Introduction................................................................................................................................3
Background - Trading.com........................................................................................................3
The risks faced by the company.................................................................................................4
Results of the assessment...........................................................................................................8
Conclusion..................................................................................................................................9
References................................................................................................................................10
Appendices...............................................................................................................................12
Appendix 1...........................................................................................................................12

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Introduction
According to the viewpoint of Ansoff et al. (2018), a business organisation is
successful only when the same is capable enough of sustaining through the risks that appear
in the business proceedings and strategic plans and processes. In this connection, it was also
examined that the employees working at any level in the business organisation are
accountable to analyse the risks that occur in the business as well as the identification of the
primary reasons that made the risk to appear in the company (Epstein 2018). With respect to
this, the managers and the leaders are accountable to find possible ways that would mitigate
the risk and avoid haphazardness in the plans and processes of the business. Researches show
that at the present scenario considering the company and its environment a risk assessment
tool is known to emerge in the same that helps the business firms to analyse the risk they are
accountable to face in their business. The same is recognised to be known as the Risk
Exposure Calculator. Thus, the particular report is focused on explaining the risks that the
company named as Trading.com is facing at the current time period.
Background - Trading.com
The concerned company is known to operate its business proceedings in the sector of
offering ordinary individuals with the courses of share investment as well as the mentoring
services. The mission and vision of the company lie in building successful investors in the
business environment with the correct mindset, educational background and also technical
support. In this connection, the company tends to offer the facilities of investments to its peer
customers and claiming that the same would help the customers to pertain to savings at an
earlier age and become a young as well as a retired business person. It was also recognised
that the concerned company with the concern of their mission and vision have been able to
achieve a recognisable success and paradigm in the business market of trading. However, it

4GOVERNANCE ETHICS AND SUSTAINABILITY
was also examined that the growth achieved by the company has been seen in different ways
by its different employees. As analysed with the help of the studies it was observed that the
owner of the company named a Jospe Drake was found to be optimistic about the growth of
the company as well as expanding the same in different sectors, and lieu of this, the other
individuals connected to the business were found to be cynical about the same. Thus, there
were several conflicts that aroused in the plans and processes of the same.
The risks faced by the company
As opined by Reason (2016), a business organisation has to suffer and face several
kinds of threats while operating the firm. In this concern, it was also critically discussed that
if the risks are handled and mitigated correctly, the same can lead to effective and efficient
development and growth of the concerned organisation. Thus, this factor becomes essential
for the company and its viewpoint of succeeding and achieving the desired goals and desires.
In this connection, the report focuses on determining the risks that the concerned company of
Trading.com faces in its business proceedings.
Risks faced due to the growth
The primary focus of any business organisation remains to sustain itself in the long
run and grow and expand its business in the global prospect (Bryson 2018). Any and every
business firm has a desire to earn a recognisable level of financial and sustainable growth.
Moreover, it was examined that the concerned company is known to have a risk in the
process of growth and thus a dilemma on the focus of achieving the target and goals arises in
the company. The conflict that the company should focus on maintaining its quality or
quantity arises in the long in order to retain and achieve loyalty for the firm. The significant
risks associated in terms of growth and expansion of the concerned company is determined to
be earning the brand loyalty as well as the different level in the skill of the employees. In this

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connection, the major pressure points analysed that occurs due to the growth sector are
specified as below.
 Pressure for performance – Every single employee in the organisation has pressure to
perform to their best capabilities in order to gain the individual as well as the
organisational goals (Dixon 2017). Thus, negligence in the performance of even a
single employee will impact the performance of the whole organisation of
Trading.com. The degree of the risk score in this sector concerning the Trading.com is
at the level of 3 (Refer Appendix 1).
 Rate of Expansion – As opined by Kolk (2016), a business firm in order to gain a
higher paradigm and loyalty in the business market is accountable to expand itself in
the global and international sector. This also puts the company into the pressure of
increasing its cost of investment as well as bearing the challenges and risks that would
come up in the way of expanding the business in an international and global basis.
The degree of the risk score in this sector concerning the Trading.com is at the level
of 4 (Refer Appendix 1).
 The inexperience of critical employees – Employees, are determined to be the
essential part of the business firm (Farmer 2016). They and their work are what
decides the reputation and image of the business. Thus, it creates pressure on the
concerned company of recruiting a skilled level of employees and provide training
and development program to the non-skilled existing employees. The degree of the
risk score in this sector concerning the Trading.com is at the level of 2 (Refer
Appendix 1).
Risks faced due to cultural diversity

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The chances that are associated with a company regarding its cultural diversity is
known to be at a higher paradigm (Charles Jr, Schmidheiny and Watts 2017). This is because
any business organisation, including Trading.com, has employees who are from different
parts of the world. The same is also known to inherit different cultural backgrounds as well as
heritage as according to the place and community they belong to. In this connection, the
concerned business organisation is liable to maintain its working environment keeping in
mind the cultural diversity of employees and also providing them with a healthy and unbiased
business working environment. It was analysed that maintaining a culturally diversified
organisation would help the concerned business organisation to enhance the level of work of
the employees as because the same would sustain the employees and motivate them to work
with greater zeal and enthusiasm for the business organisation. The primary pressure points
recognised in this case are.
 Rewards for entrepreneurial risk-taking- It was recognised that the concerned
company is termed to be highly competitive in its nature. The owner of the company,
Drake has highly and effectively managed its business proceedings and plans that let
the same to grow and expand within the business market and earn a higher level of
competitive advantage as compared to its competitors. However, as examined that the
company provides its employees with various payout schemes in the concern of
getting a greater amount of customers to the business, this, in turn, fosters the
employees to use unethical means of fulfilling the purpose and earning rewards from
the same. Moreover, it was also examined that the CEO connected to the Trading.com
is dependent on the other managers of the company to gain information about the
financial conditions and the customers of the company. This, in turn, leads to a gain of
non-genuine details and is known to affect the future paradigm of the company. The

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degree of the risk score in this sector concerning the Trading.com is at the level of 3
(Refer Appendix 1).
 Executive resistance to bad news- As stated by Burke (2017), the success of an
organisation is highly dependent on the aspect that how the business organisation
takes up and mitigates any bad news that comes in the prospect of the business
environment because of the uncertainties. In this connection, with the help of the
study, it was examined that the concerned company of Trading.com is known to
pertain a high and adequate level of resistance towards the acceptance of any bad
news that comes up their way. However, it was also examined that the employees do
not transfer the information of risk that comes up their way, and the same effect the
demonstration of performing the risk mitigation in a stipulated manner. The degree of
the risk score in this sector concerning the Trading.com is at the level of 2 (Refer
Appendix 1).
 Level of internal competition – The owner of the company Trading.com has set up its
work in a way that the employees are to be appraised according to their performance
bandings. This, in turn, increased the level of internal competency in the business
organisation of Trading.com. As discussed earlier, in order to achieve the highest
level of performance banding, the employees carry up unethical means of achieving
the same. Thus, the culture of the company is affected along with its future paradigm
and loyalty. The degree of the risk score in this sector concerning the Trading.com is
at the level of 3 (Refer Appendix 1).
Risks faced due to the information management
As opined by Doppelt (2017), the plans and processes of a business are managed
according to the information the same gathers about the business market and environment the

8GOVERNANCE ETHICS AND SUSTAINABILITY
same is working in. In this connection, it was recognised that the following categorised
sections particularly impact the concerned organisation.
 Transaction complexity and velocity – The concerned company in the given report is
known to attract the customers for its business offers the same with free seminars and
demos of services. It can also be stated that the concerned company did not indulge
with any prior course of action that would have brought the best possible results for
the company. Moreover, it was also examined that the employees of Trading.com
have frequently been recorded to adopt unfair means of getting the business done.
This, in turn, affects the brand image of the company adversely. The degree of the risk
score in this sector concerning the Trading.com is at the level of 2 (Refer Appendix
1).
 The gaps in the diagnostic performance- The concerned organisation assesses the
performance level of its employees is done on the basis of the customers they bring to
the business, and the same helps the business organisation to gain a higher amount of
revenue and profit. However, the company fails to understand the fact that the
performance appraisal should also be done on the basis of other aspects such as the
less number of absenteeism, the higher rate of timely performance. This would help
the company to meet the gap that exists in the element of appraising the performance
of the employees. However, the performance of the employees at Trading.com is
solely judged by the number of sales the employees bring to the company. The degree
of the risk score in this sector concerning the Trading.com is at the level of 3 (Refer
Appendix 1).
 Degree of decentralised decision making- The concerned company in prior discussion
in the given report is known to be a decentralised one in terms of managing its
employees. This is because the company has leveraged entire freedom to its

9GOVERNANCE ETHICS AND SUSTAINABILITY
employees in accordance to deal with the customers and help the company to gain a
higher amount of sales and revenue. Thus, the end outcome receives out of this
approach is that the employees of Trading.com are not recorded to follow the set of
rules and norms in order to achieve the performance bandings and grading. Thus, the
focus of the employees remains to be gaining the performance banding, and they do
the same with any possible way. They earn the sales target by unethical means as well
as breaking the laws and rules of the legal considerations regardless of the strict
actions of the same. The degree of the risk score in this sector concerning the
Trading.com is at the level of 2 (Refer Appendix 1).
Results of the assessment
Based on the above pieces of evidence, the report tends to sum up the risk scores of
every particular pressure point that the company is accountable to. The same is summed up to
be 25 (Refer Appendix 1). This proves that the concerned company is in the danger zone. In
this connection, the company at an urgency needs to make changes in its strategic plans and
processes.
Conclusion
To bring to an end, it can be stated that the several risks that a business firm is liable
to face are a mandatory part of the same. Moreover, the success and competency of a
business organisation depend highly on the paradigm of the ability of the company to
eliminate and mitigate the risk. Mitigating the risks becomes an integral part of the company
because the same helps the company to improve its brand image and loyalty.

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References
Ansoff, H.I., Kipley, D., Lewis, A.O., Helm-Stevens, R. and Ansoff, R., 2018. Implanting
strategic management. Springer.
Bryson, J.M., 2018. Strategic planning for public and nonprofit organisations: A guide to
strengthening and sustaining organisational achievement. John Wiley & Sons.
Burke, W.W., 2017. Organisation change: Theory and practice. Sage Publications.
Charles Jr, O.H., Schmidheiny, S. and Watts, P., 2017. Walking the talk: The business case
for sustainable development. Routledge.
Choi, T.M., Chan, H.K. and Yue, X., 2016. The recent development in big data analytics for
business operations and risk management. IEEE transactions on cybernetics, 47(1), pp.81-92.
Dixon, N.M., 2017. The organisational learning cycle: How we can learn collectively.
Routledge.
Doppelt, B., 2017. Leading change toward sustainability: A change-management guide for
business, government and civil society. Routledge.
Epstein, M.J., 2018. Making sustainability work: Best practices in managing and measuring
corporate social, environmental and economic impacts. Routledge.
Farmer, R.E., 2016. The evolution of endogenous business cycles. Macroeconomic
Dynamics, 20(2), pp.544-557.
Hammer, M., 2015. What is business process management?. In Handbook on business
process management 1 (pp. 3-16). Springer, Berlin, Heidelberg.
Hillson, D. and Murray-Webster, R., 2017. Understanding and managing risk attitude.
Routledge.

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Kolk, A., 2016. The social responsibility of international business: From ethics and the
environment to CSR and sustainable development. Journal of World Business, 51(1), pp.23-
34.
The Reason, J., 2016. Managing the risks of organisational accidents. Routledge.
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