1.1 The global risk environment Flashcards

1
Q

Organisations exist as a necus of ____________ including employees, suppliers, creditors and shareholders.

A

stakeholders

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2
Q

Effective risk management can add significant value for an organisation’s stakeholders. V____ is create by helping an organisation to achieve its objectives and protecting risk averse shareholders from financial or physical h___

A

Value

harm

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3
Q

Despite the value enhancing benefits of risk management, organisations do not always invest the level of r_________ necessary to ensure effective risk management. This is because different stakeholder groups can have different risk p_________. Only some groups are risk averse, others can be risk neutral, or even risk preferring in certain contexts (notably shareholders).

A

resources

preferences

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4
Q

C________ can exist between stakeholders where their preferences for risk differ. In particular, an organisation may not value risk management activities aimed at reducing risk where investors and well-diversified, limited l________ shareholders.

A

Conflicts

liability

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5
Q

Risk management regulation is used to help manage the conflicts that can exist between stakeholders. Although market forces can be used to help resolve c_______, imperfections exist in these forces, notably a___________ information and public good problems.

A

conflicts

assymetric

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6
Q

Risk management regulation is common in areas such as e___________ protection, health and safety and financial stability. Regulation may be country specific but i__________ regulation is very common in the 21st century.

A

environmental

international

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7
Q

International regulation is often p_________-based and r___-based. This allows it to be adapted to different situations and organisations.

A

principles

risk

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8
Q

In addition to international regulations, a range of international s_________ exist for risk management. The aim of these standards is to improve to e__________ of risk management in organisations around the world.

A

standards

effectiveness

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