The independent study of 1,100+ U.S. companies examines their risk exposures, hedging, capital markets activity, and hedge accounting practices
November 30, 2022 (Kennett Square, PA) — Chatham Financial, a global leader in financial risk management advisory and software solutions, has released its latest report, The State of Financial Risk Management. The study examined the annual 10-k filings of 1,109 publicly listed U.S. companies up to the end of the fiscal year 2021, and is a follow up to a similar study conducted in 2019.
Some key takeaways include:
- How hedging practices have changed over the past 3 years
- The most commonly used derivative products
- Asset classes where peer organizations face the most exposure
- Industries most active with M&A
“While the world saw dramatic changes in the three years from 2018 to 2021, it seems that U.S. public companies maintained their hedging policies through unprecedented times, including a global pandemic, near-zero interest rates, and an impending transition away from LIBOR,” said Amol Dhargalkar, Managing Partner, Chairman, and Global Head of Corporates, Chatham Financial.
“One finding that stood out as we look forward to 2023 is how behind newly public companies are in developing and deploying hedging strategies compared to their more established peers. Given the market volatility we saw in 2022, we expect this to be a wake up call for some of these firms to bring hedging to the forefront and be more proactive with their risk to establish and reinforce their market credibility with investors, regulators, and other industry watchers,” Dhargalkar continues.