Counterparty Risk in the Organization’s Activities: A Theoretical Model of Its Transformation into Economic Loss
Ilya Panishev
This article provides a theoretical justification for counterparty risk as an independent threat to an organization’s economic security. The problem is that in literature and applied research, counterparty risk is typically considered fragmentarily: through the lens of the counterparty’s creditworthiness, breach of contract, due diligence, bad faith behavior, or operational failures. Existing theoretical approaches do not provide a complete answer to the question of how uncertainty in counterparty relationships translates into multi–level economic damage and affects the organization’s key interests. Therefore, the purpose of this study is to construct a model describing the logic of the transition from the prerequisites of counterparty risk to its realization in the form of direct, indirect, delayed, and cascading damage. This work draws on the principles of the institutional approach, the theory of transaction costs and agency relations, the concept of opportunism, and methods for analyzing an organization’s economic security. The study clarified the concept of counterparty risk, differentiated related categories, and developed a conceptual model that includes risk determinants, mechanisms for its realization, and impact on an organization’s economic security. The scientific novelty lies in the synthesis of disparate approaches and the substantiation of the independent status of counterparty risk within the system of threats to an organization’s economic security. The theoretical signi ficance of the study lies in the formation of a foundation for developing methods for assessing counterparty reliability.