What strategies can global managers use to mitigate international financial, cultural, and political risks? (Please answer all DS completely)
Mitigating International Financial Risks
- Take loans in the same currency as the company's cashflows. eg: If your customer's are going to pay you in Euros, take a loan that is to be repayed in Euros.
- Hedge foreign exchange or interest rate risk by using appropriate instruments such as forwards, futures, swaps etc.
Mitigating International Cultural Risks
- If there are language differences, use multilingual people or have access to translators.
- Respect the local social and business norms. Involve local staff or locals in any end consumer related activities like advertisements.
Mitigating International Political Risks
- Use local partners to establish good relationships with the political players of the country.
- Be a part or rather an active member of industry associations in the country.
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