Which of the following statements are true for enterprise's risk management capability maturity level 3?
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A. B. C. D.ABD.
An enterprise's risk management capability maturity level is 3 when: -> Risk management is viewed as a business issue, and both the drawbacks and benefits of risk are recognized.
-> There is a selected leader for risk management, engaged with the enterprise risk committee, across the enterprise.
-> The business knows how IT fits in the enterprise risk universe and the risk portfolio view.
-> Local tolerances drive the enterprise risk tolerance.
-> Risk management activities are being aligned across the enterprise.
-> Formal risk categories are identified and described in clear terms.
-> Situations and scenarios are included in risk awareness training beyond specific policy and structures and promote a common language for communicating risk.
-> Defined requirements exist for a centralized inventory of risk issues.
-> Workflow tools are used to accelerate risk issues and track decisions.
Incorrect Answers: C: Enterprise having risk management capability maturity level 5 requires continuous improvement of risk management skills, based on clearly defined personal and enterprise goals.
Enterprise risk management capability maturity model is a framework that assesses the level of maturity of an organization's risk management practices. It is based on a five-level scale that measures an organization's ability to identify, assess, and manage risks effectively. Level 3 on this scale indicates that the enterprise has achieved a level of maturity where it has institutionalized risk management and is working to continuously improve its risk management practices.
Now let's review each statement to see which ones are true for an enterprise with a risk management capability maturity level of 3:
A. Workflow tools are used to accelerate risk issues and track decisions: This statement is true. At level 3, an enterprise uses workflow tools to accelerate the handling of risk issues and track the decisions made regarding them. Workflow tools can automate the risk management process, allowing for a more efficient and effective management of risks.
B. The business knows how IT fits in the enterprise risk universe and the risk portfolio view: This statement is also true. At level 3, the business understands how IT fits into the enterprise risk universe and has a risk portfolio view. This means that the enterprise has a comprehensive understanding of all the risks it faces, including IT risks, and has integrated its IT risk management practices with its overall risk management practices.
C. The enterprise formally requires continuous improvement of risk management skills, based on clearly defined personal and enterprise goals: This statement is true as well. At level 3, the enterprise formally requires continuous improvement of risk management skills based on clearly defined personal and enterprise goals. This means that the enterprise has established a process for developing and improving the skills of its risk management professionals, as well as a process for aligning those skills with the enterprise's overall goals.
D. Risk management is viewed as a business issue, and both the drawbacks and benefits of risk are recognized: This statement is also true. At level 3, risk management is viewed as a business issue, and both the drawbacks and benefits of risk are recognized. This means that the enterprise understands that risk management is not just a technical issue, but also a strategic issue that impacts the business as a whole. The enterprise recognizes that risks can have both negative and positive effects and has a process for managing those risks accordingly.
In summary, all of the statements provided in the question are true for an enterprise with a risk management capability maturity level of 3. The enterprise uses workflow tools to accelerate risk issues and track decisions, understands how IT fits into the enterprise risk universe and has a risk portfolio view, formally requires continuous improvement of risk management skills based on clearly defined personal and enterprise goals, and views risk management as a business issue, recognizing both the drawbacks and benefits of risk.