6.1 Risk management as a foundation of organisational success

Question 1

Risk management as it is understood today is a discipline that evolved during the twentieth century as a formal approach to anticipating and dealing with r____ and u_____________. A key premise of risk management is that risks can be assessed and controlled for the benefit of an organisation and its s____________.

Answer 1

risk
uncertainty
stakeholders

Question 2

Risk management is a discipline that supports decision making and the achievement of o_________. Effective decisions require information on their potential outcomes to maximise the potential for p_______ outcomes while reducing the potential for n_______ outcomes.

Answer 2

objectives
positive
negative

Question 3

Linking risk to s________ allows for a clearer assessment of aggregate risks related to a particular strategy. It also enables b______ level discussions on whether alternative strategies present a more attractive risk/return choice for an o__________.

Answer 3

strategy
board
organisations

Question 4

More recently, risk taking has been seen as a way of generating additional r_______ for an organisation.

Answer 4

rewards

Question 5

The b________ sector has to deal with the most prescriptive regulatory risk f________

Answer 5

banking

framework