International Journal of Scientific Research and Engineering Development

Emerging markets frequently display increased political risk levels, creating substantial obstacles for corporate decision-making and financial stability. This study examines how political risk affects corporate risk management strategies in emerging markets, emphasizing the use of hedging, diversification, and political risk insurance approaches. By conducting a comparative analysis of specific emerging markets, this study reveals the connection between different degrees of political stability and the strategic methods companies adopt to manage related risks.
The study utilizes a mixed-methods approach that integrates quantitative data regarding political risk indices and financial performance indicators with qualitative interviews conducted with finance managers from chosen companies. Results indicate that companies in politically unstable settings often implement more varied risk management strategies, such as offshoring, multi-currency approaches, and stricter internal regulations. Furthermore, the influence of governmental transparency, the robustness of regulations, and geopolitical instability is shown to notably impact the level and variety of risk management strategies utilized. This paper adds to both academic discussions and practical decision-making by providing empirical insights into how corporations mitigate risks in politically unstable areas. The results are especially beneficial for multinational companies, investors, and policymakers aiming to comprehend and address political risk amid swift economic growth and changes in institutions.

Rizwan Aslam,"Political Risk and Corporate Risk Management Strategies: Insights from Emerging Economies" International Journal of Scientific Research and Engineering Development, V9(3): Page(2380-2391) May-June 2026. ISSN: 2581-7175. www.ijsred.com. Published by Scientific and Academic Research Publishing.