The Impact of Risk Management on Decision Making in Banking Sector of Pakistan

Abstract

This study has emphasized on investigating the impact of risk management on decision making. In this study, risk identification, risk response, and risk evaluation have been considered as independent variables to represent risk management. Whereas, decision making has been considered as the dependent variable. In this study, banking sector of Pakistan has been chosen for data collection and to test the relationship between variables mentioned above. Research instrument used within this study for the collection of data from respondents has been the structured questionnaire. Various statistical instruments that are used primarily to analyze the relationship between these variables includes descriptive frequencies, reliability, correlation, regression, ANOVA, coefficient etc. The results interpreted through correlation and regression by the help of SPSS software have shown the significant impact that risk management (risk identification, risk response, and risk evaluation) has on decision making. The findings have explained that risk management is highly significant in influencing decision making in banking industry of Islamabad. Based on the findings, it has been concluded that risk identification, risk response, and risk evaluation (independent variables) have significant positive impact on the decision making (dependent variable) in banking sector of Pakistan