"Economic exposure": Foreign exchange risk management. The extent to which the value of a firm is at risk of adverse change as a direct or indirect consequence of future movements in foreign exchange rates. This risk includes: (1) The risk of adverse effects on the firmâ€™s future operating cash flows arising from changes in foreign exchange rates. For example, key competitors having currency cost bases in weaker or depreciating currencies. (2) The longer-term version of transaction exposure â€“ for transactions expected to be agreed in the future, but not yet contractually committed. This is sometimes called Pre-transaction risk or Pre-transactional exposure.