What are the core principles of risk management?

The core principles of risk management revolve around a systematic and structured process aimed at identifying and addressing potential risks to an organization's assets and operations. The choice that highlights these principles includes identification, assessment, control, and mitigation of risks, which are essential steps in effectively managing risk.

Identifying risks is the first step, allowing organizations to recognize potential threats and vulnerabilities that may impact their objectives. This is followed by the assessment phase, where the identified risks are analyzed to understand their potential impact and likelihood, enabling prioritization based on their significance. The control aspect involves implementing strategies and measures to either mitigate the risks or reduce their potential effects on the organization. Finally, the mitigation phase focuses on the actions taken to minimize the impact of risks that cannot be entirely avoided.

This comprehensive approach ensures that organizations can proactively manage risks, making informed decisions and protecting themselves from unforeseen challenges. Engaging with these core principles allows for a structured way to handle risks, enhance decision-making processes, and improve overall resilience within the organization.