Approaches to Identify Relevant Risk Scenarios

A.

Identifying relevant risk scenarios is a critical step in the risk management process. It involves identifying potential events that could negatively impact an organization's objectives and assessing the likelihood and potential impact of those events.

Out of the given options, engaging line management in risk assessment workshops would be the best approach to identify relevant risk scenarios. Here's why:

A. Engage line management in risk assessment workshops: Line management is responsible for overseeing day-to-day operations and is typically the most knowledgeable about the processes and systems that are in place. By involving line management in risk assessment workshops, an organization can leverage their knowledge and experience to identify potential risk scenarios. This approach can also help to promote buy-in and ownership of the risk management process among those responsible for implementing controls and managing risks.

B. Escalate the situation to risk leadership: Escalating the situation to risk leadership may be necessary in some cases, but it is not the best approach to identify relevant risk scenarios. Risk leadership may not have the same level of detailed knowledge about specific processes and systems as line management, and they may not be able to identify risks as effectively.

C. Engage internal audit for risk assessment workshops: Internal audit can provide valuable insights into potential risks, but they may not be as familiar with day-to-day operations as line management. Additionally, internal audit is typically focused on ensuring compliance with policies and regulations, rather than identifying potential risks that could impact the achievement of objectives.

D. Review system and process documentation: Reviewing system and process documentation can help to identify potential risks, but it may not be as effective as engaging line management. Documentation may not capture all potential risks, and it may not reflect changes in processes or systems that have occurred since the documentation was last updated.

In conclusion, engaging line management in risk assessment workshops would be the best approach to identify relevant risk scenarios. It leverages their knowledge and experience and promotes buy-in and ownership of the risk management process among those responsible for implementing controls and managing risks.