WP - Risk Management

Question 1

A high-level characterization of the amount of uncertainty (acceptable risk) an organization is willing to pursue or to accept to attain its risk management goals.

Answer 1

Risk appetite

Question 2

Reporting of an organization’s violations of policies and processes by employees.

Answer 2

Whistleblowing

Question 3

Situation in which one party engages in risky behavior knowing that it is protected against the risk because another party will incur any resulting loss.

Answer 3

Moral hazard

Question 4

Metrics that provide an early signal of increasing risk exposures for an enterprise.

Answer 4

Key risk indicators (KRIs)

Question 5

Expected monetary loss every time a risk occurs; calculated by multiplying asset value by exposure factor.

Answer 5

Single loss expectancy (SLE)

Question 6

Organization’s desired gain or acceptable loss in value.

Answer 6

Risk position

Question 7

Protocol that an organization implements when an identified risk event occurs.

Answer 7

Contingency plan

Question 8

A characterization of the amount of uncertainty (acceptable risk) an organization is willing to pursue or to accept to attain its risk management goals, defined in a range above and below a target.

Answer 8

Risk tolerance

Question 9

Expected monetary loss for an asset due to a risk over a one-year period; calculated by multiplying single loss expectancy by annualized rate of occurrence.

Answer 9

Annualized loss expectancy (ALE)

Question 10

System for identifying, evaluating, and controlling actual and potential risks to an organization.

Answer 10

Risk management

Question 11

Situation in which a person or organization may benefit from undue influence due to involvement in outside activities, relationships, or investments that conflict with or have an impact on the employment relationship or its outcomes.

Answer 11

Conflict of interest

Question 12

Potential for harm, often associated with a condition or activity that, if left uncontrolled, can result in injury or illness.

Answer 12

Hazard

Question 13

Uncertainty that has an effect on an objective, where outcomes may include opportunities, losses, and threats.

Answer 13

Risk

Question 14

Tool used to gather individual assessments of various characteristics of risk (for example, frequency of occurrence; degree of impact, loss, or gain for the organization; degree of efficacy of current controls).

Answer 14

Risk scorecard

Question 15

Amount of uncertainty that remains after all risk management efforts have been exhausted.

Answer 15

Residual risk

Question 16

Action taken to manage a risk.

Answer 16

Risk control

Question 17

Principle that organizations should take all steps that are reasonably possible to ensure the health, safety, and well-being of employees and protect them from foreseeable injury.

Answer 17

Duty of care

Question 18

Situation in which an agent (for example, an employee) makes decisions for a principal (for example, an employer) potentially on the basis of personal incentives that may not be aligned with the principal’s incentives.

Answer 18

Principal-agent problem