Fall Of The Lehman Brothers And Bean Stearns - Free Essay Example

Sample details Pages: 19 Words: 5746 Downloads: 2 Date added: 2017/06/26 Category Finance Essay Type Essay any type Did you like this example? The fall of Lehman Brothers and Bean Stearns triggered the financial crisis from 2007 to 2008. In the case of Lehman Brothers, which was one of the largest investment banks with old history in United States, illustrated the importance of appropriate internal risk management with control. Self-interview threat occurred and was leading to the bankruptcy. Don’t waste time! Our writers will create an original "Fall Of The Lehman Brothers And Bean Stearns" essay for you Create order In the event of lacking enough bank reserve for withdrawal, Bank of East Asia (BEA) chose to enter mass of capital and welcome the public to take freely from the account balance. It would like to increase the stakeholder confidence and is finally success and solve the problem. It is s obvious that risk management plays an important role in the financial institutions. Risk management is the management of identification, assessment and prioritization of risks to assess the effectiveness and efficiency of the internal control system and reduce the impact of unexpected events. (ISO 31000, 2009) Without proper risk management, banks are difficult to operate with financial difficulties and survive during the financial crisis. An effective risk management also improves Corporate Governance procedures that help to increase investor confidence, transparency and accountability that helps institutions operate efficiently. If any error or missing occurs in the process of risk management, it caus es a failure of corporate governance and may result in operating difficulty. In United Kingdom (UK), the Financial Services Authority (FSA) provides framework of risk management (Arrow), risk assessment framework and financial risk outlook (FRO) for financial institutions to understand the major risks. In addition, Turnbull provides a guidance of good internal control with implication of UK corporate governance code that focuses on the quality and extent of risk management disclosures in an organization and thus reduces the impacts. Combined Code (1998) requires the board of director (BoD) to maintain a good internal control system that includes risk management that safeguarding the tangible and intangible asset and ensure the effectiveness of system. In United States (US), the Sarbanes-Oxley Act (SOX) 2002 requires that both management and auditor to maintain a sound internal control system. Section 302 requires management to certify the periodic financial reports and disclos e significant internal control deficiencies and section 404 requires management to provide assessment of the internal control and auditors to provide opinion on that assessment. And the generally accepted accounting principles (GAAP) set accounting rules that corporations need to follow, i.e. they need to prepare, present and report the financial statements. In Hong Kong, the international banking regulation Basel III is applicable to banks. And HKMA regulates the economic stability in banking industry. Many large banks, like the Hong Kong and Shanghai Banking Corporation Limited (HSBC), also implement the SOX act, New York Stock Exchange (NYSE) corporate governance rules and USA PATRIOT act of the other countries in the Hong Kong. Internal control plays an important role in enterprise risk management (COSO, 2004 Pagano, 2001) Woods (2008) states the relationship between an effective and efficiently internal control linking with enterprise risk management (ERM). It also claim s that management-based internal control includes conflicts of interest for internal auditors, is extremely risky for the financial institution. Harker and Stvros (1998) shows the efficiency of risk management significantly affect financial performance of financial institutions. Without effective risk management, auditing of financial statement and expense of audit may be affected and cause unreliable reports. In the financial crisis from 2007 to 2009, many corporations include banks liquated due to a weak internal control system without an effective risk management. Therefore, a good risk management programme is important to the firm in the Hong Kong banking industry. Hong Kong and Shanghai Banking Corporation Limited (HSBC) is one of the worldà ¢Ã¢â€š ¬Ã¢â€ž ¢s largest financial institutions and thus its risk management will be identified, analyzed and compared with its competitors. Banking regulations and frameworks will be reviewed and key elements of risk management will be identified and compared. The debates will be reviewed and the strength and weakness of internal control of HSBC will be identified. In addition, recommendations for future improvement in effective risk management will be drawn. Aim and objectives of study The aims of the study are to illustrate the importance of maintaining a good risk management programme in the Hong Kong banks and to draw recommendations for the improvement of weaken risk management. To achieve this aim, the objectives have been established: To review banking regulations and framework (Basel III) apply to Hong Kong banking industry To compare and examine the risk management of internal control systems in HSBC and its competitors To review different comments given by its stakeholders during financial crisis (2008) and era To identify the strengths and weakness of an HSBCà ¢Ã¢â€š ¬Ã¢â€ž ¢s risk management To provide conclusions and recommendations for future improvement in effective risk management in financial institutions 1.3 Proposed Chapter Headings: Introduction Importance of Risk management Background The aim and objectives of the study Structure of the dissertation Literature Review Introduction of risk management Kinds of bank risks Credit risk Liquidity riskà ¢Ã¢â€š ¬Ã¢â‚¬  funding risk Interest rate risk Mismatch risk Market liquidityà ¢Ã¢â€š ¬Ã¢â‚¬  market price risk Market risk Foreign exchange risk Regulations framework Benefit of risk management Weaknesses of risk management Causes of business failure Stress Testing Example of banks: Hong Kong and Shanghai Banking Corporation Limited (HSBC), Bank of China (BOC) Government and authority intervention Conclusion An effective internal audit function of an successful case in Hong Kong The weakness of internal control system cause influence and failure of business performance Research Methods Statistical analysis of annual reports of different corporations to compare their differences with in ternal control systems Data findings Profile of respondents Data analysis Conclusion Recommendation Research direction Recommendations and Conclusions Summary of the actual findings Recommendations for an effective internal control system and risk management Limitations of Corporate Governance Chapter 2 Literature Review 2.1 Introduction of risk management The uncertainty environment leads to financial services products have become more complex and also increase the accountability of regulation. (Collier, 2009) Doyle (2007) shows that there are common material weaknesses in the risk management of complex and rapidly growing. Krishnan (2005) states limited scope of research leads to insufficient disclosure of internal control. Internal control plays an important role in enterprise risk management (COSO, 2004 Pagano, 2001) It includes 4 stages: risk identification, quantitative or qualitative assessment of risks, risk prioritization and response planning. Role of risk management Collier (2009) ALARM 2.2 Kinds of bank risks COSO (2004) defines enterprise risk management as a process applied with strategies to identify and manage potential risks and thus providing reasonable assurance of achieving corporate objectives. Basel I (1999) states banks should use measurement techniques based on robust data. Eccles et al (2001) reviews the US GAAP and SEC and illustrates 4 major risks: market risk, credit risk, operational risk and accounting risk. Then, Fell Devine (2003) demonstrate operational risk should be separated as liquidity risk, insurance risk and group risk. Further, De Wit (2007) recognizes that risks also include legal risk, concentration risk and reputation risk in financial institutions. There is legal risk of possibility of court cases. If they are well-known of providing good service about criminal, more companies would like to create financial relationship them that concentration risk arises. Also, negative publicity, which is uncontrollable and unpredictable, often lead to reputation r isk in money laundering case. Collier (2009) states there are many ways of classification of risks. Recently, Besis (2010) states there are 7 major types of risks in banks: credit risk; liquidity risk (funding risk); interest rate risk; mismatch risk; market liquidity (market price risk) and foreign exchange risk. 2.2.1 Credit risk Credit risk, which is risk of financial loss that creditors fail to execute their obligation of payment, is the main risk in banking industry that potential loss due to counterparty fail to execute payment obligation. (Besis, 2010) Collier (2009) mentioned that credit risk increases the impact of default as it can be transferred to third parties by using securitization. 2.2.2 Liquidity riskà ¢Ã¢â€š ¬Ã¢â‚¬  funding risk 2.2.3 Interest rate risk 2.2.4 Mismatch risk 2.2.5 Market liquidityà ¢Ã¢â€š ¬Ã¢â‚¬  market price risk 2.2.6 Market risk 2.2.7 Foreign exchange risk 2.3 Role of governing bodies in risk management and control International Federation of Accountants Committee (IFAC) concludes the role of governing bodies in risk management and control in public sector. (International Federation of Accountants, 2001, cited in Collier, 2009, p.37) They should ensure to establish an effective risk management in the framework of control. Also, ensuring effective internal audit function includes in that framework. Moreover, they should ensure a framework of internal control is well established with practice and the statement of effectiveness is included in the annual report. Lastly, they should form an audit committee that involves non-executive independent members to provide independent review of the framework of control and external audit process. 2.3 Regulations framework 2.3.1 Basel Basel III is a set of international banking regulations developed by the Basel Committee on banking supervision. It revises Basel I and II that requires a higher level of capital. Basel II, which improves the weakness of Basel I, considers regulatory capital with risks. (Glantz Mun, 2008) Basel II provides three approaches for calculation of risk. A standardized approach is commonly used that requires banks to use standard risk assessment to calculate the risk weightings. Next, internal ratings-based (IRB) foundation approach that is based on internal assessment in probability of default from counterparty (PD), quantified estimates of exposure at default (EAD) and loss given default (LGD) can be applicable. And the third approach is called IRB advanced approach, which is based on own internal assessment in PD, EAD and LGD. 2.3.2 Benefit of risk management Weaknesses of risk management Causes of business failure Fight (2004) states that many industry surveys analysed 5 top causes of business failure. First of all, it states cyclical decline in demand is at the top of the five causes. Recession is not the main factor of failure but the element that helps to show the weakness of risk management in firms. It mentions some examples of weakness, such as poor competitive position, problem in internal control of quality and financial and weak capital and liquidity ratios. With these weaknesses, firms lost competitive advantages and cannot fulfill customer needs and also lead to decline in demand. Next, poor top management is followed. Thirdly, lacking of centralized financial control Fourthly, bad acquisition or inadequate integration strategy. The fifth is inappropriate product or market strategy Except the cyclical decline in demand, the other four causes are related to management. It is showed that management of firms plays an important role of survival in economic downturns. Regarding to the case of Lehman Brothers, the creditor fail to execute their obligation of payment that the demand of mortgage or loan was dropped. 2.5 Stress Test 2.6 Example of banks 2.6.1 Hong Kong and Shanghai Banking Corporation Limited (HSBC) Hong Kong and Shanghai Banking Corporation Limited (HSBC) is a world-wide diversified banking group that involves in different business and activities since 2005. It takes conventional strategy in its entities in different areas, such as Europe, Hong Kong, Rest of Asia Pacific, Middle East, North America and Latin America. HSBC Holdings plc (2009) mentions that there are many factors vary the risks in HSBC, such as environment change. vary the degrees, measurement, evaluation of its risk management. mentions there are 4 main types of risks: credit risk, counterparty credit risk, market risk and operational risk in its business. Its credit risks arise from failure of receiving payment by customers or counterparties in its business, such as direct lending, trade finance, leasing business, guarantees, derivatives and debt securities. It applies 3 approaches in Basel international banking regulations to calculate the counterparty credit risk and determine exposure values. The three approaches are standardized, mark-to-market and internal model method (IMM). HSBC adopt the standardized approach and mainly adopt the IRB advanced approach to eliminate the credit risk. In addition, counterparty credit risk is risk of economic loss that counterparty may default in transactions arises from offer-the-counter (OTC) derivatives and securities financing transactions. HSBC uses the mark-to-market and IMM approaches to reduce the counterparty credit risk. Market risk is the risk of lower income or portfolio value with market risk factors, including foreign exchange rates and commodity prices, interest rates, credit spreads and equity prices. To get rid of it, HSBC applied standard rules of financial services authority (FSA) and value at risk (VAR) models. Lastly, operational risk is a risk of potential loss by imperfect internal processes and systems or external events. Actually, it also includes technological and legal risks. HSBC employed the standardized ap proach to determine its operational risk in group. To control risks in the IT area, 3 ways is implemented. First, it uses risk bases project management (RBPM) and a global HSBC tool that is called clarity tool to control the software development life cycle and ensure the consistency and efficiency of management. Second, a disaster recovery plan (DRP) is implemented. For example, it is used to recover system in the case of disasters to ensure the continuity of system. Third, it maintains a secure and reliable governance structure to control and response to the technological risk in different departments. For instance, senior management committees are responsible for managing the risk. The committees consist of HTS Steering Committee, Risk Management Committee (RMC), Operational Risk and Internal Control Committee (ORICC). In the way of managing legal risk, HSBC concerns with contractual, litigation, legislative or regulatory, reputation and non-contractual rights. In addition, it established policies and procedures, estimates potential losses from the judicial or administrative resolutions, disclose the relevant information. Moreover, it established policies and procedures for the identification, measurement of legal risk to eliminate or reduce the possible loss due to the non-performance of the norms and avoid adverse resolutions. 2.6.2 Bank of China (BOC) Bank of China applied the stress testing. 2.7 Government and authority intervention Woods et al (2009) states without perfect credit risk management, the survival of numerous financial institutions in the financial crisis relies on financial support or taking-over by government. In United States, Lehman Brothers, Bear Stearns and Merrill Lynch collapsed because of no financial support to continue the business. On the contrary, United Kingdom mortgage providers, Northern Rock and Bradford and Bingley, survive in financial crisis as had been taken over by government. In addition, Derbyshire Building Society and the Cheshire Building Society faced substantial problems and then survived as it had been taken over by the Nationwide, a large mortgage lender with a stronger capital base. Starting from summer 2007, accumulating losses on sub-prime mortgage triggered financial tsunami in the global financial system. The paper analyzes that banks and mortgage providers using special purpose entities (SPE), collateralized mortgage obligations (CMOs) or collateralised debt obl igations (CDOs) and illiquidity as the problems Financial Services Authority (FSA) provides operating framework (Arrow II), risk assessment framework and regulations for financial institutions. 2.8 Conclusion Chapter 3à ¢Ã¢â€š ¬Ã¢â‚¬ Research method The research is mainly based on quantitative research by obtaining statistical data, such as complaints or commercial crimes, and related to annual reports and financial statement. Reports from Hong Kong Monetary Authority (HKMA) and Securities and Futures Commission (SFC) will be a part of source to analyze the data as it is easily assessed and convenient in obtaining data. In addition, the risk management system of 10-15 limited companies will be examined and compared. It helps to define the strength and weakness between different risk management systems under sudden events. It supplements questionnaires collection and theoretical research. Questionnaires collection is also used as an instrument in obtaining useful information. To obtain relevant information from stakeholders, questionnaires about satisfaction of financial institutions will be collected and some samples will be further conducted by face-to-face survey. And theoretical research is taken place on reviewing infor mation of theories and practices about an effective internal control system with suitable risk management from academic journals and textbooks. 3.2Limitation: It is difficult to assess information because the internal information is not related to the operation that source is limited and limited samples are not be sufficient to conclude subject to risk management. In other words, recommendations are not be sufficient for the whole banking industry. In addition, the online questionnaires do not have a large number of respondents as the respondent rate is limited due to many reasons. For example, some people do not interest in filling questionnaire and some people feel trouble to complete the questionnaire. Chapter 4 Profile of the respondents A survey was conducted in late 2010, from October to November. Online questionnaires were collected from 30 respondents to understand their confidence level of banks in Hong Kong whether it is influenced by the occurrence of financial crisis and also obtain recommendations of risk management in Hong Kong banks for improvement. There are 25 questions in a questionnaire (see appendix) and it is formed as 3 parts: Personal Details; Before Financial Crisis (2007 -2008); After Financial Crisis (2007 -2008). The first 5 questions are about à ¢Ã¢â€š ¬Ã…“personal detailsà ¢Ã¢â€š ¬?. For question 6 to 8, questions are part of à ¢Ã¢â€š ¬Ã…“before financial crisisà ¢Ã¢â€š ¬?. And questions 9 to 25 are focused on à ¢Ã¢â€š ¬Ã…“after financial crisisà ¢Ã¢â€š ¬? that shows present. The major findings drew from the questionnaires are concluded as below. Personal Details Question 1: What is your gender? Female Male Total 16 14 30 In the online questionnaires, there were 30 respondents that slightly more than half of them are Female while slightly less than half of them are male. Question 2: What is the range of your age? From the questionnaires, it was found that the respondents are mainly youngsters which are most (26 in 30 respondents) in the range of 18 to 29 years old. And there are a small number of respondents (2 in 30 respondents) in the range 30 to 39 years old and (2 in 30 respondents) the range of 40 to 49 years old. Question 3: What is your education level? According to results of questionnaires, no respondents are educated under primary level. Three fifths of respondents achieve the degree education whereas the minority of them, 2 in 30 respondents, reach the master or above education level. And the other two sixths of respondents completed secondary to diploma education. Question 4: What is the range of your monthly salary? It is showed that half of the respondents have monthly income less than $5000 while one fifth of them have over $5000 but lower than $10000 and the other one fifth have monthly income between $10000 and $19999. The minority of respondents got income more than $20000 each month that one respondent got more than $20000 but less than $30000 and two respondents got more than $30000. Question 5: What is your role in bank? The respondents are mainly customers in banks that there are over 90% of them, 28 in 30 respondents, as the role of customers and less than 10%, 2 in 30 respondents, of them as the role of employees in bank. Before Financial Crisis(2007-2008) Question 6: Before financial crisis (2007 2008), what was the percentage of your salary you spend on saving in a bank each month? Before financial crisis (2007 2008), almost two fifth (37%) of respondents expressed that they had habit of saving. Only a few of them spent their salaries mostly on saving while a minority spent much more on saving every month. And one in six respondents spent almost half of salary on saving. In the meanwhile, three fifths of them spent fewer while a few respondents spent slightly fewer or none on saving. Question 7: Before financial crisis (2007-2008), did you invest in stock of Hong Kong banks, such as HSBC? Over 70% of respondents, 73%, said that they had habit of investment in Hong Kong stock before financial crisis (2007-2008) while slightly less than 30%, 27%, had not invested. Question 8: Before financial crisis (2007-2008), what was the percentage of your salary you spend on investment each month? Before financial crisis (2007-2008), most of respondents had habit of investment. Three fifths of respondents had spent much more and majority or all of salary on investments each month. For example, less than half of them, 43%, had spent the majority and almost all of salary (80% 100%) on investment while one sixth had spent 60% to nearly 80% of salary. And a small number of them, 10%, had spent almost half of salary (40% 59.99%) on investment while nearly one quarter (23%) of them had spent fewer (25% 39.99) on investment. But, few respondents, 7%, said that they had not invested or spent slightly fewer on investment. Question 9: Did you have habit of checking your balance in your current accounts /investment accounts in banks? And how often did you check your balance each month? Before financial crisis (2007-2008), none of the respondents never check their current account or investment account balance. One in three respondents showed that they seldom (1 to 7 times per month) checked their balance in accounts while half of them often checked their accounts over once a week and nearly once per two days (8-15 times per month). And one in five respondents usually checked their accounts (16-30 times per month). After Financial Crisis (Present) Question 10: Do you own any current accounts for saving in banks? How many banks do you own current account? All respondents have current accounts for saving in banks in Hong Kong. One-fifth of respondents reported that they only owned current account in one bank while almost most of them, 77%, said that they owned current accounts in from two to four banks. In addition, only one respondent responded that hold current accounts in more than five banks. Question 11: What is the percentage of your salary you spend in saving each month? It is showed that most of the respondents have habit of saving. Almost a quarter of them, 23%, spend much more on saving while about two fifths of them, 41%, spent majority or almost all on it. Also, no respondents spend almost half of salary (40%-59.99%) while a minority of them reported they spent fewer and nearly a quarter of them reported they spent slightly fewer and almost none on saving. Question 12: Do you invest in stock Hong Kong banks, such as HSBC? After financial crisis (2007-2008), three fifths of respondents said that they had habit of investment in stock of Hong Kong banks while two fifths did not invest. Question 13: Do you own any investment accounts in banks? How many banks do you own current account? Most of the respondents own investment accounts in Hong Kong banks. For illustrate, more than half of respondents, 73%, only own investment accounts in a bank while 1 in 10 respondents own an investment account in two to four banks. And one-sixth of them, 17%, do not own any investment account and. However, no respondent hold investment accounts in more than five banks. Question 14: What is the percentage of your salary you spend on investment each month? More than half of respondents reported that they spent their salaries less on investment. One third of them spent slightly few and almost none of their salary on investment while one fifth spent fewer as well as the other one fifth almost spent half of it on investment. On the other hand, a small number of them, 10%, responded that they spent much more while 1 in 6 respondents spent most and almost all on investment. Question 15: Do you have habit of checking your balance in your current accounts/ investment accounts in banks? And how often do you check your balance each month? After financial crisis, none of the respondents never check their current account balance. Nearly three fifths of respondents,57%, reported that they seldom (1 to 7 times per month) checked their balance in account while one fifth of them often checked their accounts over once a week and nearly once per two days (8-15 times per month). In addition, about a quarter of them checked their accounts frequently (16-30 times per month). Question 16: After financial crisis (2007-2008), what do you pay attention to the bank before investment in it? (Answers can be chosen more than one.) The table shows the issues about bank whether respondents pay attention to before investment or not. After financial crisis (2007-2008), the respondents mainly pay attention to the news about the bank and also the banking industry before investment. Nearly three quarters of them, 73%, pay attention to the news about the bank and banking industry to concern about their investment. In addition, one-fifth of them pay attention to the risk management of the bank to concern whether risks are minimized and properly controlled. And the other one fifth also pay attention to relevant court cases while three in ten respondents focus on the changes in its share price. However, only a minority pay attention to the big issues, such as big loss or financial difficulties. Question 17: What element(s) do you think it is important in risk management? The table illustrates that importance of elements in risk management respondents revealed. Regarding to questionnaires, almost two fifths of the respondents thought identification of risk was important in risk management while about two thirds of them did not. About assessment of risks, nearly third fifths (57%) of them agreed it was an important element while more than two fifths of them (43%) disagreed. In addition one third of respondents expressed that internal control is an important element in risk management. However, only a minority of respondents, 4%, totally agreed that identification, assessment, and prioritization of risks and the internal control are important in risk management. Question 18: Do you trust the risk management of bank can ensure steadily operation with lower risks to prevent bankruptcy? Two thirds of respondents reflected they trusted the risk management of bank that can ensure it operating steadily with lower risks and prevent bankruptcy while one third said that they did not trust it. Question 19: What is the level you rely on the risk management of bank? After financial crisis (2007-2008), a small number (10%) of respondents reflected that they extremely relied on the risk management of bank while one fifth said that they more relied on it. Half of them remained neutral whereas a minority less relied and a few respondent never rely on the risk management of the bank. Question 20: After financial crisis (2007-2008), have your confidence in bank been cracked? About two fifths of respondents, 37%, thought their confidence in bank had not be cracked after financial crisis (2007- 2008). Nevertheless, half of them reflected their confidence were partly impaired while a minority (13%) revealed that their confidence were mostly damaged. Question 21: What is (are) the issue(s) that impair your confidence in the bank and make you think that it has weak risk management? The chart illustrates the issues whether it can impair their confidence of respondents and affect their investment decision in the bank. According to the responds, a majority of respondents, 90%, thought occurring liquidity problem and big loss can impair their confidence in the bank. And 70% of them expressed that weaken defense of risks and without experience of facing financial crisis can lead to bank have a weak risk management and also impair their confidence. Besides, slightly more than a quarter of them, 27%, considered human resources problem was one of the elements of weak risk management. For example, improper authorization and delegation policies lead to conflict of interest exists in the bank. Moreover, nearly one-fifth thought operating without following regulation, such as Basel framework, is more likely to maintain weak risk management. Finally, only a few of them, 7%, responded that involving in court case impair their confidence in bank and they might think it had weak risk management Question 22: Do you read the annual report of bank to understand its risk management before investment? The above chart shows that one third of respondents responded that they saw annual report of the bank before investment to understand its risk management. However, two thirds of them expressed that they did not. Question 23: Do you think these banks have good risk management? In five Hong Kong banks, respondents expressed which banks they think have good risk management. As a result, most of them commented HSBC had a good risk management while only one third thought Bank of China had a good risk management. Also, half of them expressed that Hangseng Bank had good risk management while the other half disagreed that. Concerning to standard chartered bank, only one fifth thought its risk management was good. Moreover, slightly less than twenty percent of them reflected that Citibank had good risk management. Question 24: What rank do you give for the risk management of HSBC? (Please rank from 1to 5: 1 is weakest; 5 is best) Rank of HSBC Number of respondents 1 1 2 3 3 13 4 9 5 4 Total 30 Mean 3.4 Medium 3 Gathering the data from the questionnaires, the mean of rank of risk management of HSBC is 3.4 and the medium is 3. More than two fifths of the respondents (43%), gave 3 of risk management in HSBC while almost one third gave 4 and a small number of them gave 5. And only a few respondents (3%) ranked 1 while a minority ranked 2. Question 25: What is (are) the problem(s) of risk management in HSBC you think? According to the comments from respondents, there are some problems of risk management in Hong Kong and Shanghai Bank (HSBC). First of all, it is difficult to accurately predict the risks under the uncertain environment. Second, the company structure of HSBC is too huge that the monitoring between different countries would include some gap. For example, HSBC has different business in different countries that standard of monitoring is less effective and efficiency. Thirdly, it had a weak risk management in credit risks during the sub-prime mortgage crisis. For instance, it had written off large amount since the Lehman Brother in United States. Lastly, HSBC more focus on globalization but less in customer. Summary Chapter 5 Data findings and analysis 5.1 Questionnaire 5.2 HSBC According to the risk management framework of HSBC, Capital and risk management pillar 3 disclosures (2009) illustrates the figures of credit risks in HSBC Holding plc. It is measured by 3 methods: IRB advanced approach; IRB foundation approach and standardized approach. The appendix 2 demonstrates the figures of risk-weighted assets analysis by geographical region. At 31 December 2009, the risk weighted assets in Hong Kong accounts for 119.5 billion US dollars where total risk-weighted assets are 1133.2 billion US dollars. It is shown that entity in Hong Kong own 11% in HSBC group. At 31 December 2008, it was 102.1 billion US dollars in Hong Kong out of 1148.0 billion US dollars in total risk-weighted assets. In 2008, Hong Kong accounts for 9% in HSBC group. Comparing 2008 and 2009, it is obvious that the weighted average in Hong Kong is raised from 11% to 9%. To maintain good risk management, HSBC holds more capital base to support the development of its business than Ba sel regulation requires. Although Basel requires 8% minimum total capital, HSBC holds 13.7% in 2009 to withstand future risks. Appendix 2 Table 1 shows the figures of capital requirements that total amount accounts for 90.7 billion US dollars. It shows that credit risk accounts for 80% (72.3 billion US dollars) while counterpart credit risk accounts for 5%, market risk 5% and operational risk 10%. Clearly, credit risk is the main risk in HSBC and a threat during sub-prime mortgage crisis. Without accurate prediction of risks, it is more likely to write off huge amount and lead to big loss in bank and easier to bankruptcy. Regarding to maintain a healthy risk management, HSBC is monitored by its group audit committee to independently review the effectiveness of its internal control and also its risk management system. Its group audit committee is formed by non-executive directors to meets regularly with HSBCà ¢Ã¢â€š ¬Ã¢â€ž ¢s senior financial, internal audit, risk, legal and complia nce management and the external auditor to consider HSBC Holdingsà ¢Ã¢â€š ¬Ã¢â€ž ¢ financial reporting, the nature and scope of audit reviews and the effectiveness of the systems of internal control, compliance and risk management When considering risk matters, Group Management Board (GMB) convenes as the Risk Management Meeting (RMM), chaired by the Chief Financial Officer, Executive Director, Risk and Regulation. RMM is the Groupà ¢Ã¢â€š ¬Ã¢â€ž ¢s senior à ¢Ã¢â€š ¬Ã‹Å"designated committeeà ¢Ã¢â€š ¬Ã¢â€ž ¢ as defined by the FSAà ¢Ã¢â€š ¬Ã¢â€ž ¢s rules, and has responsibility for setting risk appetite and approving definitive risk policies and controls. It formulates high-level Group risk management policy, exercises delegated risk authorities and oversees the implementation of risk appetite and controls. It monitors all categories of risk, receives reports on actual performance and emerging issues, determines action to be taken and reviews the efficacy of HSBCà ¢Ã¢â€š ¬Ã¢â €ž ¢s risk management framework Internal assessment of capital adequacy remains sufficient to support the Groupà ¢Ã¢â€š ¬Ã¢â€ž ¢s risk profile and outstanding commitments; exceeds the Groupà ¢Ã¢â€š ¬Ã¢â€ž ¢s formal minimum regulatory capital requirements by an agreed margin; is capable of withstanding a severe economic downturn stress scenario; and remains consistent with the Groupà ¢Ã¢â€š ¬Ã¢â€ž ¢s strategic and operational goals, and shareholder and rating agency expectations. HSBC Holdings plc (2009) mentions that there are many factors vary the risks in HSBC, such as environment change. vary the degrees, measurement, evaluation of its risk management. mentions there are 4 main types of risks: credit risk, counterparty credit risk, market risk and operational risk in its business. Its credit risks arise from failure of receiving payment by customers or counterparties in its business, such as direct lending, trade finance, leasing business, guarantees, derivatives and debt securities. It applies 3 approaches in Basel internati onal banking regulations to calculate the counterparty credit risk and determine exposure values. The three approaches are standardized, mark-to-market and internal model method (IMM). HSBC adopt the standardized approach and mainly adopt the IRB advanced approach to eliminate the credit risk. In addition, counterparty credit risk is risk of economic loss that counterparty may default in transactions arises from offer-the-counter (OTC) derivatives and securities financing transactions. HSBC uses the mark-to-market and IMM approaches to reduce the counterparty credit risk. Market risk is the risk of lower income or portfolio value with market risk factors, including foreign exchange rates and commodity prices, interest rates, credit spreads and equity prices. To get rid of it, HSBC applied standard rules of financial services authority (FSA) and value at risk (VAR) models. Lastly, operational risk is a risk of potential loss by imperfect internal processes and systems or external events. Actually, it also includes technological and legal risks. HSBC employed the standardized approach to determine its operational risk in group. To control risks in the IT area, 3 ways is implemented. First, it uses risk bases project management (RBPM) and a global HSBC tool that is called clarity tool to control the software development life cycle and ensure the consistency and efficiency of management. Second, a disaster recovery plan (DRP) is implemented. For example, it is used to recover system in the case of disasters to ensure the continuity of system. Third, it maintains a secure and reliable governance structure to control and response to the technological risk in different departments. For instance, senior management committees are responsible for managing the risk. The committees consist of HTS Steering Committee, Risk Management Committee (RMC), Operational Risk and Internal Control Committee (ORICC). In the way of managing legal risk, HSBC concerns with contr actual, litigation, legislative or regulatory, reputation and non-contractual rights. In addition, it established policies and procedures, estimates potential losses from the judicial or administrative resolutions, disclose the relevant information. Moreover, it established policies and procedures for the identification, measurement of legal risk to eliminate or reduce the possible loss due to the non-performance of the norms and avoid adverse resolutions.

A Separate Peace - Symbolism Essay examples - 1597 Words

In John Knowle’s A Separate Peace, symbols are used to develop and advance the themes of the novel. One theme is the lack of an awareness of the real world among the students who attend the Devon Academy. The war is a symbol of the quot;real worldquot;, from which the boys exclude themselves. It is as if the boys are in their own little world or bubble secluded from the outside world and everyone else. Along with their friends, Gene and Finny play games and joke about the war instead of taking it seriously and preparing for it. Finny organizes the Winter Carnival, invents the game of Blitz Ball, and encourages his friends to have a snowball fight. When Gene looks back on that day of the Winter Carnival, he says, quot;---it was this†¦show more content†¦Phineas’ death is the end of Gene’s childhood. He is forced to grow up when he realizes that he is living in a world of hate, crime, and disappointment. He is getting older and closer to his eighteenth bir thday when he will be drafted into the war, and he finally begins to prepare. At the conclusion of the novel, after Phineas is gone, Gene says, quot;I was ready for the war, now that I no longer had any hatred to contribute to it. My fury was gone, I felt it gone, dried up at the source, withered and lifeless. Phineas had absorbed it and taken it with him and I was rid of it foreverquot; (871). This is another example of how the war furthers Gene’s advance into adulthood. The war is a symbol of how things aren’t always what they seem. Recruiting posters and propaganda advertising the army convince many boys into thinking the war is an exciting adventure in which young men interact. Leper enlists in the army after being impressed by a film shown by a recruiter from the U.S. ski troops. quot;The ski movie had decided him. ‘I always thought the war would come for me when it wanted me†¦I never thought I’d be going to it. I’m really glad I saw that movie in time, you bet I am’quot; (826) Leper is amazed by these men and how they, with their recognizable and friendly faces, give a clean response toShow MoreRelatedAnalysis Of A Separate Peace 901 Words   |  4 Pages Devon had many incidents that occurred during the summer session and the regular school year. â€Å"Peace had deserted Devon† (Knowles pg.72). A tree, showing symbolism, has a big part in the story, A Separate Peace. The events happening during the summer session and regular school session, hinted foreshadowing, for later events to come. In Devon’s school, multifariously terminus students have a distinct story and oblique events tremble throughout the school. The students attending Devon have been throughRead MoreLord Of The Flies, By William Golding And The Perks Of Being A Wallflower1087 Words   |  5 Pagesgenres. Novels such as Lord of the Flies by William Golding and The Perks of Being a Wallflower by Stephen Chbosky are among some of my most beloved. In my junior year, I read A Separate Peace by John Knowles for my AP U.S. History class while I read The Catcher in the Rye by J.D. Salinger over the summer. A Separate Peace explores the rivalry that can lie at t he heart of many friendships and conveys the concept of individuality rather than conformity. Similarly, The Catcher in the Rye is the storyRead MoreAnalysis Of Sylvia Plaths Tulips831 Words   |  4 Pageshospital room, separate from their family. No one is present in the white hospital room, except for the speaker and the tulips. The room is peaceful and allows the speaker to enjoy a lack of commitment towards anything. Unfortunately for the speaker, the tulips in the room remind the speaker of their life and bind the speaker to their responsibilities. In Sylvia Plath’s â€Å"Tulips,† color symbolism and personification contrast the peace of disconnection and commitments in life. Color symbolism of the whiteRead MoreWilliam Golding s Lord Of The Flies 1299 Words   |  6 PagesDecember 2014 Savagery in Civilization: Symbolism in Lord of the Flies Symbolism as defined by the Merriam Webster Dictionary, is â€Å"the use of symbols to express or represent ideas or qualities in literature, art, etc.† (â€Å"Symbolism†). For this reason, symbolism is utilized in literature in order to make novels more interesting and convey notions that are usually either highly controversial or extremely philosophical. For example in the popular novel A Separate Peace, John Knowles uses Gene in order toRead MoreWonder Wom The Feminist Symbol Behind The Bracelets1379 Words   |  6 Pagesinclude classics such as a sword and shield, and also includes a lasso a. She possesses superhuman abilities that were blessed to her by the gods and they included Hermes, Aphrodite, Artemis, Hestia, and Demeter. Her amazonian origin creates powerful symbolism for women everywhere and she provides women with strength. To truly understand Wonder Woman you must know of her origin. Created out of clay by her mother Hippolyta--the queen of the Amazons-- Wonder Woman was given life from the the gods of ancientRead MoreThe Story By Naigub Mahfouz1727 Words   |  7 Pagesmiracle worker to cure him) is in pursuit to achieve the mystical Islamic Zaabalawi. On the other perspective, the narrator’s pursuit appears as a search for piety, God, and mystical experience. One of the two perspectives depicts the search for inner peace while the other depicts the search for a great physician. Therefore, one of the search is necessitated by the illness while the other is an urge to return to the roots. The short story by Naigub Mahfouz presents a search for religious knowledge byRead MoreComparison and Contrast of a Separate Peace and Catcher in the Rye1515 Words   |  7 PagesComparison and Contrast Essay A Separate Peace and The Catcher in the Rye The coming of age novels, The Catcher in the Rye, written by J.D. Salinger, and A Separate Peace, written by John Knowles, both interpret the lives of adolescent boys journeying through their conflicts and inner confusion to reach the level of maturity. Salinger and Knowles both discern the literal ways a typical teenager grows up with the help of literary elements such as plot, setting, character development, conflictsRead More Religious Symbols and Symbolism in Faulkners Light in August1555 Words   |  7 PagesReligious Symbolism in Light in August  Ã‚  Ã‚   William Faulkner’s, Light in August has many references to Christianity. He employs a great deal of religious symbolism in all of his characters. These parallels seem very intentional, even though, Faulkner himself says he did not do it purposely. The Christ story is one of the most popular stories invented and it seems right that at some point someone is going to write similar to it. William Faulkner says he did not put the Christian parallels inRead More Comparing A Separate Peace and The Catcher in the Rye Essay example1500 Words   |  6 PagesComparing A Separate Peace and The Catcher in the Rye The coming of age novels, The Catcher in the Rye, written by J.D. Salinger, and A Separate Peace, written by John Knowles, both interpret the lives of adolescent boys journeying through their conflicts and inner confusion to reach the level of maturity. Salinger and Knowles both discern the literal ways a typical teenager grows up with the help of literary elements such as plot, setting, character development, conflicts, irony, symobolismRead MoreEssay on Symbols and Symbolism in the Poems of Robert Frost1463 Words   |  6 PagesSymbolism in the Poems of Robert Frost    Nature has inspired countless poets from primitive times to the present. They have used it as a metaphor for virtually all human emotions-his stormy brow, her sky blue eyes, as wild as a summer storm. Very few, however, have so masterfully crafted their verse to fully express the range of nature’s power and influence, or suited the tone of a poem to encompass both human nature and ‘true’ nature. This is true in the poetic works of Robert Frost. The aspects

Distance Between Us free essay sample

In the memoir, â€Å"The Distance Between Us,† by Reyna Grande, Reyna explains how her and her three siblings managed to grow up without any parents. Mago, Carlos, Reyna and their new sister, Betty, all live a rough life without any real type of love from their parents so they have to rely on each other for guidance and support. The four Grande children formed a special bond over the years that they will not leave anyone behind. Each character in the memoir contributes significant personality traits that help the others cope with their current situation. First, one of the oldest Grande child, Mago, who is caring, courageous, develops leadership amongst everyone and is capable of being a good mother at such a young age. Mago’s mother left her with a huge responsibility to be â€Å"their little mother† (12). Mago was stripped of her childhood and forced to mature up. Mago molded Carlos and Reyna into who they are today because of the absence of their mother when they were younger. We will write a custom essay sample on Distance Between Us or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page When she found out the news about the new baby coming, she quickly said, â€Å"they’re replacing us†(33). Mago wasn’t please with her mom new baby because she told her mom. Carlos and Reyna believes Mago portrays a much more better mom than their real mom. Following by Carlos, the second oldest who has a great sense of humor and has ambition to support his sisters. Carlos may not have been the bravest, but he did the best he can to support his sisters when they needed it most. When his sister, Mago, was feeling down, â€Å"he tried to make Mago laigh by telling us his favorite jokes about a boy named Pepito† (38), Carlos was sad when his mother left and Mago was there to support and encourage him to not be sad over it. Reyna always encouraged Carlos to do his best in whatever he was doing. Over the months, Carlos sacrificed himself and lost connection with his sisters because he was always gone with a male guardian doing labor just to support his siblings. Carlos may not have been there at some points, but he was always back at the end of the with his sisters. When their mother came back, he became a man for not just his mother, but for his sisters as  well. When he got sick trying to protect their land, his Abuelita asked to take him home but refused and answered, â€Å"no, no, no. I want to help Mami with her dream house† (128). Carlos had wanted to prove to his mother that he wants her to stay badly, even if it could cost him his life. The second to youngest of the Grande children, Reyna, who is much more of a supportive friend than is a sister, would always boost everyone’s confidence in the memoir. Therefore, it gives confidence to everyone in order to succeed. Reyna was always the most baby in the memoir but Mago changed that and taught her how to be brave in the time of need. Reyna looks up to Mago the most because Mago is the only one who notices what she does. Carlos supports Reyna, but he’s also going on away trips to find a decent father role model. Mago once told Reyna that, â€Å"it doesn’t matter that there’s a distance between us now. That cord is there forever† (21). Mago wasn’t Reyna’s real mom; she tried her best to be the best she could be for not only Reyna but for Carlos and Betty too. Last, the youngest of the Grande children, Betty. She is not portrayed a lot in the memoir but she was most close to Mago since she took care of her when their mom left. Although, Mago didn’t like it at first throughout the memoir because when her mom, â€Å"handed Mago her little girl and told her to take care of her while and Abuelita Chinta prepared dinner,†(73) she refused. Mago knew she was not going to be responsible for a child that wasn’t due to her action. But Betty quickly adapted and eventually Mago and the other siblings grew a bond that was inseparable. Even if, they didn’t accept the fact that they had to take care of Betty when they were struggling on themselves. Mago realizes that the mom put Mago in a difficult position. In conclusion, the 4 Grande children had no parental guidance other their the oldest sibling, Mago. We learned that no matter what kind of obstacle is thrown at the siblings, they would overcome everything together. They will all stick together, and make sure no one will be left behind. Mago, Carlos, Reyna and Betty all love each other very much and they never want to lose each other. They all carry a special bond that certain families don’t have, which is struggling through a tough time and still manage to stay with one  another.

Kurt Cobain1 Essay Example For Students

Kurt Cobain1 Essay For our modern day hero we used the singer and songwriter Kurt Cobain from the band Nirvana. This punk Seattle band moved almost mainstream almost overnight. Nirvana caught on fast and changed rock and roll music forever and molded the music of the 90s, alternative. Cobain had an enormous amount of talent but unfortunately his life was cut short by a still controversial suicide in his Seattle home. On April 9, 1994, his body was discovered. He is a hero for many of todays troubled youth because his music influences how these troubled kids feel. They are able relate to Cobain and his music. Kurt Cobain was born in 1967. He lived with his sister and parents two hundred miles away from Seattle in the small logging town of Aberdine. His aunt, who helped him form his first band, introduced him to music at a very young age. His parents divorced when Kurt was only seven years old. Torn up by his parents divorce, he went to live with his mother in a trailer. After the divorce, Kurt was force d to look at his life in a different light. Kurt became extremely anti-social, had few friends, and was picked on in school because kids thought he was gay or weird.Kurt started writing poetry at the age of thirteen, and when he was 14, he received his first guitar. Throughout high school he was in many bands- Fecal Matter, Skid Row, Brown Cow, The Sellouts and Pencap Chew. He formed Nirvana during his senior year of high school with his friends Chris Novoselic and Dave Grohl who Kurt called the worlds best drummer. Shortly after the band was formed, Kurt dropped out of high school, and his mother kicked him out of the house. Homeless, he lived under a bridge at the end of his street. It was here that he would spend time alone writing his own songs. From his parents divorce to his mother pushing him out of the house, Kurt had become even more alienated from other people and life. He was very detached. Kurt hated the music of big rock bands like the Sex Pistols, Rolling Stones and Aerosmith. He felt their lyrics were sexist and pointless with no meaning. Kurt was a very sensitive and emotional person, a characteristic that showed through all of his songs. Eventually he became so famous that he a cult following. The songs exemplified the kids world. In the song Dumb Kurt sings, I think Im dumb over and over again to show how his years of neglect from his peers at high school and his family made him feel as if he was to blame. Kids relate to his music because it portrays how the world was so cruel and how he and the kids were treated badly. He was responsible for the most creative rock music of the last decade. Kurt didnt have to hide behind face paint or wear tight clothes to grab attention as the other rock stars. He wore flannel s and jeans, something that every other kid wore, and he wasnt ashamed by it. In one song Come As You Are Kurt sings Come as you are as I want you to be. He wanted to show the youth that they dont have to follow the crowd and do something someone else wants them to do to fit in. Every modern alternative song has a tint of Nirvanaism in it. Just like bands that followed the Beatles, many groups that followed Cobain tried to sound or copy his same music pattern. In his music he didnt communicate in complete sentences or elaborate arguments. Instead his lyrics were a stream of conscious insights that inspired and appealed to the short attention span of his audience.We picked Kurt Cobain as a hero because he is different than the conventional hero who just goes out and saves lives. Kurt was an emotional leader for the troubled youth, and he gave them a place to escape from a life that was hard to live. His music gave them a hideaway from the harsh realities of the real world. All they had to do was listen, and they felt instant relief because they knew that not only they felt the way they did. They could relate to Kurt and his fragile emotions. In the song Rape Me Kurt sings; Rape me, my friend. Rape me again. Im not the only one. Hate me. Do it and do it again. Waste me. Taste me, my friend. My favorite inside source, Ill kiss your open sores. Appreciate your concern. Youll always stink and burn. This shows how he believed society took advantage of him because he was weak and emotional. These kids relate to Kurt. Kurt once said that he would rather be in pain than fame. His words and music make him a modern day hero. .u422f2e1179412f0864e5f091390e7595 , .u422f2e1179412f0864e5f091390e7595 .postImageUrl , .u422f2e1179412f0864e5f091390e7595 .centered-text-area { min-height: 80px; position: relative; } .u422f2e1179412f0864e5f091390e7595 , .u422f2e1179412f0864e5f091390e7595:hover , .u422f2e1179412f0864e5f091390e7595:visited , .u422f2e1179412f0864e5f091390e7595:active { border:0!important; } .u422f2e1179412f0864e5f091390e7595 .clearfix:after { content: ""; display: table; clear: both; } .u422f2e1179412f0864e5f091390e7595 { display: block; transition: background-color 250ms; webkit-transition: background-color 250ms; width: 100%; opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #95A5A6; } .u422f2e1179412f0864e5f091390e7595:active , .u422f2e1179412f0864e5f091390e7595:hover { opacity: 1; transition: opacity 250ms; webkit-transition: opacity 250ms; background-color: #2C3E50; } .u422f2e1179412f0864e5f091390e7595 .centered-text-area { width: 100%; position: relative ; } .u422f2e1179412f0864e5f091390e7595 .ctaText { border-bottom: 0 solid #fff; color: #2980B9; font-size: 16px; font-weight: bold; margin: 0; padding: 0; text-decoration: underline; } .u422f2e1179412f0864e5f091390e7595 .postTitle { color: #FFFFFF; font-size: 16px; font-weight: 600; margin: 0; padding: 0; width: 100%; } .u422f2e1179412f0864e5f091390e7595 .ctaButton { background-color: #7F8C8D!important; color: #2980B9; border: none; border-radius: 3px; box-shadow: none; font-size: 14px; font-weight: bold; line-height: 26px; moz-border-radius: 3px; text-align: center; text-decoration: none; text-shadow: none; width: 80px; min-height: 80px; background: url(https://artscolumbia.org/wp-content/plugins/intelly-related-posts/assets/images/simple-arrow.png)no-repeat; position: absolute; right: 0; top: 0; } .u422f2e1179412f0864e5f091390e7595:hover .ctaButton { background-color: #34495E!important; } .u422f2e1179412f0864e5f091390e7595 .centered-text { display: table; height: 80px; padding-left : 18px; top: 0; } .u422f2e1179412f0864e5f091390e7595 .u422f2e1179412f0864e5f091390e7595-content { display: table-cell; margin: 0; padding: 0; padding-right: 108px; position: relative; vertical-align: middle; width: 100%; } .u422f2e1179412f0864e5f091390e7595:after { content: ""; display: block; clear: both; } READ: Rosa Parks EssayBibliography:

Digital versus Traditional media in advertising

Table of Contents Introduction Body The shift from print to online media Analogue to digital television Digital interactive media Conclusion References Introduction A radical change in the media industry is totally transforming the whole meaning of advertising. In light of this, advertising has grown from a mere sub-industry to a very critical sector in the business world. Changes in technology have drastically transformed the manner in which operations are conducted in the world.Advertising We will write a custom essay sample on Digital versus Traditional media in advertising specifically for you for only $16.05 $11/page Learn More This new wave of change has seen a rapid growth in the digital media as a way of advertising. The digital interactive forms of advertising have been availed at the very appropriate time considering the amazing rate at which globalization is affecting business operations across the world (Langdon, 1996). This essay is an a ttempt to explore into this field and see how the digital interactive media is transforming the whole concept of advertising. It seeks to delve into the commonalities and the differences that characterize the traditional forms of advertising and the digital interactive forms of advertising. This essay will therefore delve into these issues while paying greater attention to the manner in which the whole aspect of advertising is changing. Body Firstly, the traditional forms of advertising that dominated much of the last few decades include television, print and radio. These forms of advertising are considered traditional in the sense that newer methods of advertising have actually come up rendering them close to being obsolete. But really, can the digital forms totally take over the process of advertising without back up from the traditional forms? Well, that is subject to a whole range of debates. Nevertheless, it must be stated from the onset that the traditional forms of advertisin g cannot in any way be relegated into the dustbin of history as they really supplement the digital media advertising. The digital media technology has availed many options in the field of advertising that had not been seen before. Today, more than merely watching an advert on the television, one can download the information they have watched and even store it for future use. It is in light of these varieties that one feels the urge to dissect the whole concept of advertisement to see the realities that have characterized the field and recommend options to anyone seeking to launch any advertisement in the market.Advertising Looking for essay on advertising? Let's see if we can help you! Get your first paper with 15% OFF Learn More Any advertisement should be designed taking in mind that consumers are inundated with a flood of information at their disposal. The modern digital forms of advertising have therefore an upper hand in this aspect compared to the traditional met hods which may not reach many people as expected (Langdon, 1995). The shift from print to online media Secondly, the world has continued to become much global as time progresses. This has seen multinational companies establish branches all across the world. The goods and services produced are therefore targeted for not only the local markets but for the whole world. This has created the need for advertisement forms that reflect of the diversity of the world and can reach all corners of the world where the goods are supposed to be utilized. The print media industry has for a long time been dominated by the newspapers as the major forms of advertising. Newspapers, however, have the disadvantage that they cannot be supplied across the whole world. A paper published in New York for instance may not be circulated past the United States. They are therefore limited by reach. However, with the advent of the internet and the radical shift that characterizes the whole sub-sector, most of thes e materials can now be accessed online by the consumers. Mobile phone technology is currently extensively used as an advertising media. The number of people reached in this case is very large considering that majority of people own cell phones. Major newspapers have today introduced online versions where readers can access all the information at the comfort of their mobile phones or personal digital assistants (PDAs). It is a common trend today for most people in the developed world to read their newspapers online other than buy the hard copies on the streets. The printed papers may therefore go out of market in a few years if the rapid adoption of technology across the world is anything to go by. It is interesting to note that the world’s population is mainly dominated by young people who are below 25. It is this same young population that extensively uses the internet. This is a clear indication in the great potential that lies in the field of online advertising.Advertising We will write a custom essay sample on Digital versus Traditional media in advertising specifically for you for only $16.05 $11/page Learn More Newspapers, however, still continue to enjoy a large readership especially among the educated and in the developing world where internet is still expensive. Research shows that educational levels are a great determinant of the readership of newspapers. People who have spent much time in school tend to read newspapers more than those who have not. It is normally quite hard to change people’s behavior patterns and this has the implication of limiting advertisers on the amount of population they would wish to reach. Magazines are very popular all over the world and have become a very rich ground for reaching many consumers. They also have the advantage of reaching specific groups of people in the community. For instance, beauty magazines mostly target young women and could therefore effectively convey adver ts relating to such women. Like in newspapers, magazines have also managed to create an online presence and most of the popular magazines are presently read online in addition to the conventional printed versions. However, the online media in the case of magazines has not gained much root as in newspapers. Many people still prefer to buy their magazines in the streets and shopping outlets as opposed to reading them online. This provides a suitable ground where the advertisers can harness many opportunities (Australian Interactive Media Industry Association, 2009). Analogue to digital television Thirdly, a radical change has been seen the world of television where operations have totally been transformed. Television has been use for decades as method of advertisement. Much of that use began in the later part of the 1950s when television sets were available in entirely the whole world. Televisions sets have for a long time been in the analogue form that availed viewer with various opt ions such as the free to air TV cable TV and pay-tv. Currently a shift is occurring from the analogue to the digital television, which has come with various modifications to the interest of the viewers.Advertising Looking for essay on advertising? Let's see if we can help you! Get your first paper with 15% OFF Learn More The digital form enables the viewers to access many channels and interact more. This allows people to control their viewing and hence the advertisements they get. Advertisers have seen a great opportunities in the digital television that were hitherto unavailable in the analogue. It is estimated that by 2014, 80% of television viewers in the world will be using the digital television sets (PRC,2006). This can provide a glimpse on the amount of information that will be conveyed to the people in the form of advertisements. Radio as a form of advertising is not left behind in light of the new changes that characterize the advertising industry. Even though the digital radio is still limited to only metropolitan areas in the world, it is forecasted that by 2014 it will be within reach to over half of the population in the world. Digital radio like digital television, offers interactive capabilities to the listeners. It is not just audio as in the analogue case as it combines visual abili ties to provide the listeners with additional features such as graphics, animation and slide shows. Digital radio will therefore be used to offer better advertising services to the listeners. Presently, however, the analogue radio will continue to reign supreme in advertisements. It can be seen that both the traditional and the digital forms of advertisements are actually merged up. They continue to operate as a unit by supplementing each other (Commercial Radio Australia 2009). The dissatisfaction realized from television advertising comes from the fact that at any given time, the advertiser is not sure about who is actually watching. It therefore heavily relies on a matter of chance such that if the advertiser is lucky, then the intended target will be watching. Otherwise the whole advert becomes useless. Another problem also arises out of the fact that the interests of people who watch television are not usually the same. A discomfort therefore arises when an advert that only fav ours a particular category of people comes up. Advertisements by television costs more than the interactive forms of advertising. Their use is therefore becoming more and more limited to specific products. Digital interactive media Digital interactive media is used to refer to the modern digital systems that are computer based that offer various options to the users. Such options include animation facilities, audio-visual, text and graphics (Lane, W R, King, KW Russell, JT 2005). The advertising industry has greatly benefited from the introduction of new media in the market. Large companies are currently managing multi-billion dollar projects in this field. The digital interactive media has totally revolutionized the whole process of advertising (Digital Radio Plus 2010). Advertising companies now do more than mere advertising. They have become media companies as well. The revenue these companies receive today is much higher in comparison to the earlier days when they depended on t he traditional media. The modern media, in addition to advertising, offers the consumers links through which they can purchase the products being advertised using e-commerce (The Pew Research Center for the People the Press 2006). By simply clicking a mouse, one can receive supplier at their doorstep courtesy of the new media. This revolution enables people to interact and relate to each other more and more. Such interaction further increases the number of transactions conducted between the people. That is of much concern to the advertisers who intend to increase the sale turnover. While it can be well argued that advertisements by television have continued to increase in the recent past, the impact is not substantially felt. Television channels have become so many and people can easily shift from one to another. This implies that the image of the products advertised on the various channels is not left in the minds of the viewers (Langdon, J 1995). They forget entirely everything. That is what creates the need for interactive media. Here, one can click a link on the screen to get more information about the product being advertised. Attention is therefore drawn on the particular product after which the user may opt to purchase it. The use of digital advertising is no longer experimental like it was few years ago. It is gaining root full blast. All the changes seen are actually necessitated by the fact that the consumers demands are changing. People today want mobile things, immediate and with the ability to control what they consume from the media. As such, it becomes impossible to offer such people the adverts in the traditional methods that will require one to be glued to their television sets or radio. Gone are the days when families would sit in their living rooms in the evenings with all eyes glued to the television. The manner in which broadband advertising presents itself is very compelling to the viewers. The adverts are strategically placed on the ver y sites where people frequent to obtain information. That is when the ad pops up. One is tempted to click on the link to reveal the information, which in many cases will be in the form of motion pictures and videos. Moreover, many advertisers today have the practice of offering interactive media in cases where other media is used. For instance, when reading magazines an advert will show you the specific website of the producer where you can obtain more information about the product. The same is normally seen in television where the adverts will encourage the viewers to log into the websites given on the screen to find more information about the products. Today, many advertisers have capitalized on the great use of the social networking sites like Facebook and MySpace. Thorough these sites, they can easily reach millions of consumers that frequent them. They also take advantage of the fact that majority of the people who use the sites are young. It is therefore common to see adverts about products used by young people frequently popping up on the screens when one is logged in (Langdon, J 1996). Several multinationals have heavily invested on the interactive advertising methods and are gradually shunning the traditional ways. The giant consumable goods manufacturer Proctor Gamble has indeed been ahead in adopting broad broadband adverts for its products that are available all over the world. The company has realized that young people shun traditional adverts and is therefore investing heavily in online ads to reach millions of youth across the globe. An average person in America is bombarded with so many advertisements in a single day. This flood of information ranges from billboards to adverts in subway trains. The avalanche of such information may not therefore have any lasting impression on the minds of the population. As such, better ways have to be sought to create adverts that may leave a lasting image on the mind s of the people and compel them to buy the products. That is where the interactive media comes in handy. It is therefore impressive to note that many advertisers have adopted this option. Even though the internet still accounts for only a small percentage of the total adverts in the world, many companies are beginning to join the bandwagon. It has bee realized that the internet may not be very efficient in the case of a new product that is still trying to build a brand name. Nevertheless, it can widely be used for entirely all products that are used in the world. Studies have further indicated that the next 5 years will see tremendous changes in the advertising industry, more than what has been realized in the last 50 years. This is courtesy of the better forms of advertising, increasingly educated, empowed consumers, and better advertisers who manage the whole scene quite well. The popularity of the digital media is not only gaining predominance out of its superior quality but as well as the lower costs associated with it (Australian Government, 2011). Every supplier in the market wants to minimize the costs involved in the operations.IBM for instance has managed to reduce its expenses on advertisement by 20 percent in the last four years (Russel,2005 and Pew Research Center 2010). This is because of the tireless effort by the company to invest heavily in the digital media advertisement. A survey of 1500 consumers and 50 advertising experts reveals very interesting outcomes about the manner in which the advertising industry behaves (Journalism.org,2010). Certain market drivers that determine the success of all the adverts that are posted in the market govern the industry. One such driver is the consumer choice and control. The report indicated that consumers mostly prefer advertisement media that give them the ability to control and manage whatever they view or hear (Magazines.org, 2010). As a result, it implies that they actually prefer the digital methods that offer them such abilities. Another det erminant in the market is creativity. It should be remembered that the advertisement industry is very dynamic and it therefore demands only those who can come up with better and improved ideas every day. It does not give room for those boring daily adverts that were often heard on radio and seen on televisions sets a few years ago. Conclusion The digital interactive forms of advertisement that are cropping up currently are actually the sure way of staying competitive in the increasingly competitive market that is characterized by globalization and other market changes seen across the world. The digital forms are certainly better in terms of giving the customers variety and giving the advertisers an opportunity to track the response of the market to the goods being advertised. However, the traditional forms continue to supplement these new methods. They go hand in hand in giving the consumer the best they can have. It is therefore important that both the forms be adopted for the succ ess of any business. References Australian Government n.d., Popular Australian television, Culture Portal. Web. Australian Interactive Media Industry Association (AIMIA) 2009, ‘Digital Services Index TM’. Web. Commercial Radio Australia 2009, ‘FAQs’. Web. Digital Radio Plus 2010. Web. Journalism.Org 2010, How internet and cell phone users have turned news into a social experience, PEW Research Center. Web. Lane, W R, King, KW Russell, JT 2005, Advertising procedure, 16th edn, Prentice Hall, New Jersey. Langdon, J 1996, ‘The history of radio in Australia: excerpts from a lecture given by Dr Jeff Langdon’, Radio 5UV. Web. Langdon, J 1995, ‘A history of community broadcasting,’ Radio Adelaide. Web. Magazines.org, ‘What you need, when you need it’. Web. Pew Research Center 2010, State of the news media 2010, Pew Research Center Publications. Web. The Pew Research Center for the People the Press 2006, Online papers modest ly boost newspaper readership, PEW survey reports. Web. This essay on Digital versus Traditional media in advertising was written and submitted by user Brody L. to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.

Tsunamis essays

Tsunamis essays All around the world natural disasters such as earthquakes, volcanoes, tornadoes, and hurricanes, are waiting to strike like a time bomb waiting to explode. Once unleashed, these natural disasters could become deadly. One of natures tremendous natural disasters is the great waves of the mighty ocean. In the past people referred to them as tidal waves a name that is misleading because these great waves are not related to the tides in any way. The Japanese, who have felt the waves destructive power for many generations, gave them the name Tsunami pronounced soo-nahmee. The word Tsunami means harbor wave which references the giant waves ability to penetrate the protected harbors along Japans coast (Koenig, Science). Although these natural disasters are not as common as others, people need to be aware that Tsunamis can be very devastating and destructive, more so than tornados or other storms. People need to educate themselves on how tsunamis are formed, the destruction they ca n cause, and the warning and support centers that have been established before the clock runs out and its too late. Before one can truly understand the devastation and destruction these natural disasters can cause, one must first understand what causes tsunamis and how they are formed. There are many causes of tsunamis such as landslides, volcanoes, eruptions, and explosions, but the most common cause are earthquakes. The relationship between earthquakes and tsunamis has been known for more than 2,000 years ever since the Greek historian Thucydides connected an Aegean Tsunami in 426 B.C. to the quake that preceded it (Koenig, Science). However, in order for a disturbance to generate a tsunami, the disturbance must occur underneath or near the ocean, be extremely large, and cause movement in the seafloor. When earthquakes occur a plate usually plunges dow...

Integrated Project Management Tools Essay Example | Topics and Well Written Essays - 750 words

Integrated Project Management Tools - Essay Example The work breakdown structure (WBS) is basically a tool used to define work elements of a project and it identifies its entire scope. It can also be defined as a tool which identifies all the aspects of the project and above all it assists managers in maintaining control of the project. It is usually designed in a hierarchical form and its very fundamental because it helps in the evaluation of performance, cost and time at all stages of a projects Lifecycle in an organization. In this stage, the scope of the project which refers to the end result is used for planning and measuring the project. Therefore, this idea becomes of great assistance to managers because it gives the scope between the management and customers. Furthermore, it gives the objectives and goals of the project. The WBS is significant due to the fact that it gives the deliverables, milestones, technical requirements and limits and exclusions. Hence, the generic WBS is a very significant item for the breakthrough of a project. It assisted in breaking down the workload of the project and increased efficiency in handling all the required tasks. It was also important because it was time saving and economical.The scheduling system falls under the project management information system (PMIS). PMIS therefore refers to all the techniques and tools used in project management to deliver, monitor and manage project’s information. In order to use the scheduling system, there has to be softwares to be used for data manipulation and computation.

Essay Questions Example | Topics and Well Written Essays - 500 words - 5

Questions - Essay Example They all proposed that the society nature, whatsoever its derivations, was a contractual understanding between its affiliates. The present concept of sovereignty is frequently tracked down back to Westphalia Peace in the year 1648. In relation to states, it codified the necessary principles, including integrity of territories, inviolability of borders, state supremacy, and the notion that a sovereign is the superlative legislator of power within its jurisdiction (Agnew, 2009). The war that lasted thirty years was put to a stop by the Westphalia Peace which was acknowledged as the peace of exhaustion by generations. The war did influence the signing of numerous treaties commonly connected by the reality that they did put to an end the thirty years war. The war resulted in the enforcement of negotiations in abridging the differences between states that had surfaced due to the war. Deliberations did happen among the countries that were involved in the thirty years war (Agnew, 2009). Pea ce was the significant outcome that was achieved in the long run by the numerous negotiations that were carried out. Power was stripped off from Ferdinand III and consequently taken back to the imperial states rulers. At the end of the World War I, the U.S. foreign policy was fundamentally isolationist. The U.S became cautious of entering the League of Nations, a concept that had been championed by the U.S President. U.S utmost concern of joining the League was that the affiliates would entrust America and probably it troops to conflicts in the European region. The World War I was among the numerous wars that had occurred in the europ0ean region. The U.S also had an economic policy of barriers of trade (Kagan, 2008) The U.S committed to defending infant industries by means of trade constraints and tariffs. A major impact on the foreign policy of the U.S was that it closed its doors to the rest of the world. Germany developed a foreign policy with

Human Resources Term Paper Example | Topics and Well Written Essays - 3750 words

Human Resources - Term Paper Example It is because of the quality of human resource and proper management of human resource that an organization is able to differentiate itself from others and the organization is able to attain competitive advantage (Blau, 1978). Organization invests in different projects and assets so that they would yield returns to the company in the long run and the company only invests in them if the expected value of the returns of the projects or assets would be more than their total present investment cost. This theory can also be linked to the human resource of the organization and organizations invest in human resource so that they would yield them profits in the years to come and help the organization to grow as a successful venture. As human resource is the most important asset of the organization and therefore it is imperative for the organization to properly manage its human resource so that the investment yields maximum return (Roslender, 1997). There can be different kinds of investment on human resource like the cost of training, cost associated with recruitment of employees etc and therefore it is important for the management to properly analyse the cost and returns that human resource would yield and for th is purpose, human resource accounting has emerged as the solution (Mirvis, & Lawler III, 1984). The concept of human resource accounting is the process by which organization analyses and compares the investment that they have made in the human resource and the benefits that human resource yields to the organization (Pyle, 1970). This information about the cost and benefit of human resource is then conveyed to the interested parties in the organization. This kind of investment is not reported in the conventional financial statements of the organization however this investment is an important one for the long run success of the organization. This report analyses the concept of human resource accounting and how organization uses the concept of human resource accounting along with the importance of human resource accounting. In addition to this, this report also discusses about different methods with which organizations analyses the performance and cost of employees in an organization a nd limitations of each method and then the conclusion. Concept of human resource accounting and how organization uses it Human Recourse Accounting is the term used to measure the worth and cost of their organization’s employees. Thus, it is the process of identifying, quantifying and communicating the data and information about Human Recourses to the parties involved (Roslender, & Dyson, 1992). It is an effort to identify and report the investments and funds made in organization’s human recourse that are presently not accounted for in the usual accounting practices. Different organizations use the idea of human resource accounting in different ways. With the passage of time, more and more organizations have started implementing this concept considering its importance not only for the human resource department to better evaluate the performance of individuals but as it helps in improving the long profitability of the organization as they are able to identify which human resource or employee is most important to the organization and which human resource should be included in their long run plan and therefore using human resource accounting the management is able to plan things in a better way (Caplan, & Landekich, 1974). However, despite of an increasing use of human resource accounting in different industries around the world, still there are several organizations that do not utilize this concept. Human resource acco

Influence of Climate Variability on Marine Ecosystems

Influence of Climate Variability on Marine Ecosystems Large variability in populations of small pelagic fish species have been observed in global oceans (Watanabe 2009). The flexibility in reproductive features of the spawning stock combined with environmental induced fluctuation in survival rate of offspring and overexploitation, can be the major reasons for such large variability in stocks of these species (Ganias 2009) and relation between large scale climate alteration and these fluctuation known as an important scientific and economic concern (Klyashtorin 2001). Hence over the last decades, since about 1980, recognizing the process by which variability in recruitment of small pelagic fish occur, became a main subject for international co-operation and researches (Alheit and Bakun 2009). However providing a reliable correlation between global climate conditions and long-term stock variability has been forgotten till that time (Klyashtorin 2001) and lack of scientific knowledge from the process which govern recruitment was widely ide ntified in the 1980s (and still is) as the important scientific problem which hindering successful management of populations of small pelagic fish (Alheit and Bakun 2009). Main focuses of these co-operation in 1990s has been concentrated on the influence of climate variability on marine ecosystems, mainly on small pelagic species. To improve the understanding from such relations several efforts have been done to correlate regular anchovy and sardine stocks alteration with the global and regional climate indices (Klyashtorin 2001). Synchronous outbursts alteration in populations of these two species, i.e. sardine and anchovy in North and South Hemispheres might shown the signature of same global climatic events in governing of the fish populations and such alteration became the subject of several studies in this case (Lluch-Belda et al. 1989; Lluch-Belda et al. 1992; Kawasaki 1992a, 1992b; Schwartzlose et al. 1999). In study which conducted by Kawasaki (1992a), has been shown that catches of Japanese sardine are related to climate alterations, explained as air and water surface temperature in hemispheric scale. In another study by Kawasaki (1994) concept of cyclic climate alteration has been applied to explain regular alteration in the Japanese sardine catches over previous 350 years. The same dependence to climate change has been suggested also for Californian sardine (Lluch-Belda et al. 1992). Beverton (1990) and Schwartzlose et al. (1999) in case of industrial fishery collapses of the sardine (Sardinops caerulea) fishery in the California current were thought environmental induced effects may play an important role. In another studies which conducted by Bakun (1990, 1996), correlation between the long-term variability of catch of abundant small pelagic fishes and the upwelling index has been investigated. In these studies author showed that the world climate changes come with significant alte ration in the atmospheric movement, direction and acceleration of largest oceanic streams, and upwelling strength. Therefore, regarding to this background, several detailed investigations have been conducted by FAO during the years 1994 to 2001 to investigate the condition and aspect of the world fisheries and tried to make a simulations from applying of new methods to have predictions from dynamics of fish stock. Hence in latest one, which has been conducted by Klyashtorin (2001), long term variability in catches of commercially valuable species and climate alteration has been investigated. The author showd a close correlation between the climate alteration and long-term variability of the main commercial stocks, including the small pelagic species over Atlantic and Pacific oceans. With regard to important of such topics several studies continue to investigate the climate induce effects on commercially important small pelagic species in recent years (e.g. Grà ¶ger et al. 2009; Watanabe 2009; Alheit et al. 2012; Alheit et al. 2014). Rising in the abundance of European anchovy in the North Sea in the late 1980s was connected to the signal and strength of the AMO (Alheit et al. 2012). Also, in another study by Alheit et al. (2014) the dynamics and migrations of small pelagic fish stocks in the eastern North and Central Atlantic in relation to AMO have been investigated. The authors believed that a complex ocean–atmosphere alteration which occurred in the mid-1990s lead to a â€Å"regime shift† in the ecosystems of these area and the small pelagic clupeoid fish stocks have affected by this shift. The autumn-spawning herring (Clupea harengus) stock in the North Sea can be another example of the commercially valuable North Sea herring. More recent evidence from a directional alteration occurrence in recruitment of this species has been reported by Payne et al. (2009) during the 2000s. In this study authors believed that recruitment is affected not only by parental-stock biomass, but it seems that the environmental induced alteration, also, may influence the recruitment of this species in North Sea and changes in such factors could be of equal, or even more important. Hence to understand better the reproductive failures of North Sea herring, Grà ¶ger et al. (2009) also studied large-scale climate proxies in the North Atlantic Ocean, (i.e. NAO and AMO), and their potential influences on stock regeneration of this species. Commercially important pelagic species, European anchovy, which support the main fisheries in the Black sea (Chashchin 1996; Daskalov 2003) also has shown significant variability during the last five decades (Gà ¼raslan et al. 2014). According by Niermann (2004) and Oguz (2005) several process including regional climate fluctuation, overexploitation, rising the input of anthropogenic induce nutrient from rivers, and, the ctenophore (comb jelly) M. leidyi and regime shift can be responsible for such variability. Evidence has shown that not only human related activities but also environmental fluctuation can play important role in controlling anchovy production in the Black sea and such hypothesis was investigated several studies (e.g. Niermann et al. 1999; Daskalov 2003; Oguz 2005; Oguz et al. 2006). These studies have been shown strong correlation between local climatic variations such as those derived by the NAO and fluctuations of anchovy population in this Sea. Many anthropogenic induced pressure including pollution (e.g. domestic and industrial run-off, the development of vast oil and gas fields) and uncontrolled fish exploitation, also, altered significantly the Caspian sea environment during the last 3 decades. These alteration that has resulted in poor management can be caused in increasing â€Å"environmental degradation† and damaged in coastlines and trophic base of the Caspian sea (Mamedov 2006). Fisheries sector play an important role in the Caspian sea. Total annually catches for the commercially valuable fish in this sea, for instance beluga, sturgeon, and Caspian roach were around 500,000 to 600,000 tonnes, in the past decades. Such state in fisheries production was not changed till the early 1950s, then, thereafter small pelagic species fisheries has significantly increased in central and southern part of the Caspian sea to atone the decrease in catches of the aforementioned more important fish species. Total catch of kilka species has mainly maintained in level of 300,000 and 400,000 tonnes during the period between 1960 to 1980 (Barannik et al. 2004). During the past three decades kilka species and some other commercial fisheries in the Caspian Sea were suffered from significant decreases. Such decreases has been observed in total catch of the major commercial species of kilka in the Caspian, anchovy kilka, which suffered significantly from alteration (decrease trend). The catch of kilka by Russia, Azerbaijan, and Iran dropped from 182,700 t in 2000 to 74,700 t in 2001 and maintained really low after this time (Mamedov 2006). Over the period 2000 to 2011 a continuous decline of catches has been observed, the stock dramatically collapsed in 2001 and reached to its historical minimum in 2011. Dramatic collapse in mainly fisheries resource of the Caspian sea and also failure of biodiversity and ecosystem persistence in this sea became a widespread concern in the regional and internationally scales. With regard to the important role of the kilka fisheries as main source of income and protein for Iranian people in coastal area of the Caspian sea, such dramatic collapses might have unfavorable influences on economy and local protein intake (Fazli 2007). Accordingly Bagheri et al. (2004) reported economic losses around US$15 million, from decrease of anchovy kilka catches off Iranian over period of 1998 to 2001. Hence, as elsewhere, sustainable management of small pelagic fish can be vital for the fisheries and the ecosystem health of the Caspian sea. Several studies has been conducted in case of kilka species in the Caspian Sea which according by Mamedov (2006) this studies started in 1940s. The study of kilka species has been followed by others for instance Prikhod’ko (1975), Paritskiy (1989), Mamedov (2006) and Fazli (2007). Many studies has conducted in Iranian waters of the Caspian Sea. the most of these previous studies were subjected to biological characteristics, ecologic features, distribution and stock assessment of the kilka (e.g. Pourgholam et al. 1996; Fazli and Besharat 1998; Fazli 2007; Karimzadeh 2011; Aliasghari and Parafkandeh Haghighi 2013). However in previous studies several mechanisms have been proposed as reasons of aforementioned fluctuation of the kilka species in the Caspian Sea during the last decade (Mamedov 2006; Daskalov and Mamedov 2007; Fazli 2007; Kideys et al. 2008; Roohi et al. 2010; Fazli 2011). Accordingly the recent study on anchovy kilka by Daskalov and Mamedov (2007) reported several candidate mechanisms which may be responsible for such a decline of the kilka species. In this study authors believed that the major stress factor for the Caspian sea pelagic ecosystem in the past decades was the invasion of the ctenophore (comb jelly) M. leidyi. This invasion and spread of the ctenophore M. leidyi in the Caspian Sea has been introduced as the most possible primary cause of recruitment failure and the stock collapse of this specie, although other factors, including overfishing, climate change and seismic activity suggested as factors may negatively influenced dynamics of this species. Although in previous studies the effect of the climate and environmental variability on kilka species has been mentioned as one of the hypothesis that may be responsible for the fluctuation of the kilka species the detailed information about the role of climate and environmental variability on fluctuations of these commercially important species during the last decades was (still is) not clear. To our knowledge, however, only few long-term studies are currently available in relation to climate and environmental variability in the Caspian Sea (e.g. Nezlin 2005; Lougheed 2006; Moradi 2013; Fendereski et al. 2014) that mainly focused on the dynamics of Chl-a concentration, and also physical and chemical characteristics of the Caspian Sea. Despite the widely used hypothesis of the role of climate changes in fluctuations of small pelagic species there is still no detailed investigation on kilka species in the Caspian Sea during recent years. Hence, in this study the following objectives a nd hypothesis has been defined to illustrate the role of climate driven effects on the fluctuation of these kilka species.