What you should know about risk management
Risk is present everywhere and the characteristic accompanying phenomenon of the functioning of organizations in the current turbulent environment.
What is risk management?
Risk Management is an area of management focused on analyzing and reducing risk, using a variety of risk prevention methods and techniques that eliminate existing or reveal future risk-increasing factors.
Risk management is a continuous, repetitive set of interrelated activities aimed at managing potential risks. This means reducing the probability of their occurrence or reducing their impact on the business. The purpose of risk management is to prevent problems or negative phenomena, to avoid crisis management, and to prevent problems.
Risk management consists of four interrelated phases ascollected.reviews claimed:
- risk identification
- risk assessment
- risk management (respectively mitigation)
- and risk monitoring.
Types of risks
There are several types of risks in different areas:
- Economic and financial risks – includes risks affecting the economic results of the company:
- Credit risks
- Investment risks – estimating the profitability and reliability of an investment
- Insurance and reinsurance risks – an estimate of the size of the risk and the probability of an insured event
- Project risks
- Market risks – risks associated with the success of the company in the