BUISENESS MANAGEMENT
RISK MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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ISO Guide 73 ISO 31000
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Institute of Risk Management (IRM)
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“Orange Book” from HM Treasury
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Institute of Internal Auditors
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Detailed explanation-1: -Risk is now defined as the “effect of uncertainty on objectives”, which focuses on the effect of incomplete knowledge of events or circumstances on an organization’s decision making.
Detailed explanation-2: -In the UK’s Orange Book, risk is defined as the “uncertainty of outcome, whether positive opportunity or negative threat, of actions and events”.
Detailed explanation-3: -As per ISO 31000, risk is “The effect of uncertainty on objectives” whereas risk management is “coordinated activities to direct and control and organization with regard to risk".
Detailed explanation-4: -The definition of risk in ISO 31000 and Guide 73 is: the effect of uncertainty on objectives. The change in definition shifts the emphasis from ‘the event’ (something happens) to ‘the effect’ and, in particular, the effect on objectives.