Wharton Survey

Abstract

This is the third in a series of surveys on financial risk management practice and derivatives use by non-financial corporations in the United States undertaken by the Weiss Center for International Financial Research of the Wharton School. This 1998 survey, written in partnership again with CIBC World Markets, extends the previous two surveys by asking new questions about certain aspects of derivative use and risk management practice. The six-page questionnaire was mailed in October 1997 to the same basic sample of firms used in the 1994 and 1995 surveys. The sample consists of the original randomly selected 2000 publicly traded firms used in 1994 plus the remaining 154 non-financial Fortune 500 firms added in 1995. Due to mergers, buyouts, and bankruptcies since 1994, this sample currently consists of 1928 firms. A second mailing of the questionnaire was done in March 1998. 399 firms returned a completed survey, yielding a response rate of 20.7%. Of these firms, 197 are from the manufacturing sector, 82 are from the primary products sector, which includes agriculture, mining, and energy, as well as utilities, and 120 are from the service sector. In terms of size, 160 firms are from the large category, consisting of firms with fiscal year 1996 total sales greater than $1.2 billion, 116 are from the medium-sized category, with total sales between $1.2b and $150m and 123 are from the small category, with total sales less than $150m.