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Rabihah Md Sum

First Name: Rabihah
Surname: Md. Sum
Department Dept of Applied Finance and Actuarial Studies
Supervisor(s): Professor Piet De Jong ,

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Paper Title

Risk Management Decision Making: The Analytic Hierarchy Process Approach


This research aims to explore the application of Analytic Hierarchy Process (AHP) as a decision making tool in risk management.


Previous studies on risk management mainly focus on the effect of risk management on firm value, how to implement risk management, factors that determine firms to implement risk management and measuring risk and capital requirement. The Multi Criteria Decision Making (MCDM) tool has assisted decision makers in making decision involving complex issues and AHP is one of the widely used MCDM methods. The use of AHP as a decision making tool in risk management is mainly concentrated in project risk management and supply chain risk management. Studies on the application of AHP to risk management of an enterprise has not yet been done. This research aims to fill this gap.

Key literature/theoretical perspective

The key literatures are Saaty (1994) Fundamentals of Decision Making and Priority Theory With the Analytic Hierarchy Process, Saaty (1990) How to make a decision: The Analytic Hierarchy Process, Saaty (2008) Decision Making with the Analytic Hierarchy Process.


Questionnaires will be the major source of data . The questionnaires consist of questions on the pairwise comparison judgment of each of the criterion and alternatives in the decision model. The pairwise judgment will be analyzed using the AHP methodology to obtain the priority vector.

Practical and Social implications

Structure a complex decision in risk management by using the analytic hierarchy process .


risk management, decision making, analytic hierarchy process, multi-criteria decision making