Measuring risk culture in finance: development of a comprehensive measure

Understanding and measuring risk culture informs the development of interventions to improve risk culture in organizational settings. Study 1 used a rapid review to determine the need for a comprehensive and psychometrically robust risk culture scale. Identifying such a need, Study 2 aimed to develop a psychometrically robust risk culture scale. Although two scales measuring risk culture were identified in Study 1, none of these scales: (1) fully incorporated the existing conceptual frameworks identified by the review; and (2) demonstrated construct validity and reliability. This indicated there was scope for developing a new measure. Study 2 found evidence for seven unique factors (Management commitment to risk, Psychological safety, Incentives, Risk Capability and Training, Risk communication, Risk Strategy, and Risk support) of risk culture using samples of employees at a major financial firm. The scale presented in this study offers a comprehensive instrument to measure risk culture in organizational settings.