Pregunta
.5 An enterprise risk management (ERM) policy aims to …
a communicate externally that risk management is being practised.
b assist an organisation in integrating risk management into its management
c systematically apply management processes and practices.
d address specific responsibilities of the board and risk committee.
a communicate externally that risk management is being practised.
b assist an organisation in integrating risk management into its management
c systematically apply management processes and practices.
d address specific responsibilities of the board and risk committee.
Ask by Malone Park. in South Africa
Mar 27,2025
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An ERM policy aims to assist an organization in integrating risk management into its management.
Solución
To determine the primary aim of an enterprise risk management (ERM) policy, let’s analyze each option:
a. Communicate externally that risk management is being practiced.
- This option focuses on external communication rather than the internal integration and application of risk management.
b. Assist an organization in integrating risk management into its management.
- This option emphasizes the integration of risk management into the overall management processes of the organization, which is a core purpose of an ERM policy.
c. Systematically apply management processes and practices.
- While this is important, it is more general and does not specifically highlight the focus on risk management.
d. Address specific responsibilities of the board and risk committee.
- This option pertains to governance and oversight but does not encompass the broader aim of integrating risk management into the organization.
Based on this analysis, the most fitting answer is:
b. assist an organization in integrating risk management into its management.
This option captures the essence of what an ERM policy aims to achieve within an organization.
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An enterprise risk management (ERM) policy is a strategic framework that helps organizations systematically identify, assess, and manage risks across all functional areas, promoting proactive decision-making. It integrates risk management into the organization’s culture and operational processes, ensuring risk considerations are embedded in every decision at all levels.
Creating an effective ERM policy is not just about ticking boxes. It’s crucial for organizations to foster a culture of risk awareness and encourage open communication about risks among employees at all levels. Common mistakes include neglecting to involve key stakeholders during the development phase or failing to regularly update the policy to accommodate changing risk landscapes!
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