Akunyumu, S; Fugar, F D K and Adinyira, E (2025) Assessing risk allocation preferences of partners in international construction joint venture projects in Ghana. Journal of Financial Management of Property and Construction, 30(1), pp. 111-136. ISSN 1366-4387
Abstract
Purpose: Equitable risk allocation is important for the effective management of inevitable risks in International Construction Joint Venture (ICJV) projects. Previous studies have documented risks facing ICJV projects. However, there is a dearth of studies on the risk allocation preferences that take into consideration the opinions of both the local and foreign partners. This study aims to fill this gap by ascertaining the risk allocation preferences of the partners of ICJV projects for effective risk management. Design/methodology/approach: Through a survey, data on risk allocation preferences were collected from both local and foreign partners of ICJV projects using a comprehensive register of 74 risks. Findings: Following analysis, six risks were allocated to the local partner, 11 were allocated to the foreign partner, 51 risks were shared, four were allocated to a third party and two were to be negotiated based on the specific circumstances of the project. Practically, the study's findings will help ICJV partners in drafting their ICJV contracts to adequately allocate risks and reduce contract negotiation time considerably. Practical implications: The findings from this study will help partners in drafting their joint venture contract agreement and also reduce the period for contract negotiation. Knowledge of the preferred risk allocation is important in allocating risks in the contract agreement to the relevant partner for effective management. Originality/value: This study, to the best knowledge of the authors, is one of the early studies to ascertain the risk allocation preferences of ICJV project partners in the Ghanaian construction industry – a departure from previous studies which focused on the identification and evaluation of risks. This study is also different from previous studies by considering the allocation preferences of both partners of the ICJV. The collection of data from both partners of the ICJV helped to consider their perceptions on risk allocation and evaluation, essentially leading to cross-cultural and optimal risk allocation preferences.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | Ghana; international construction joint ventures; risk allocation; risk management; questionnaire survey |
| Index terms: | questionnaire, methodology, preference, survey, risk allocation, international construction, project partner, risk management, drafting, construction industry, joint venture, contract negotiation, Ghana |
| Subjects: | research methods, decision-making and reasoning, Geography, financial risk, contract management, strategic management, sociology, industry analysis, data collection methods, risk assessment, business, technical documentation |
| Topics: | Research Practice, Business Strategy, Cost Management, Stakeholder Management, International Construction, Design Practice, Contract Administration, Geographical Context, Risk Management |
| Descriptive scope: | 5 PCTEA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here