What is the overall aim of risk assessment within ORM?

The overall aim of risk assessment within Operational Risk Management (ORM) is to prioritize organizational risks and allocate resources efficiently. This process involves identifying potential risks that can impact the organization and assessing their likelihood and potential impact. By doing so, organizations can determine which risks pose the greatest threat and should be addressed first. This prioritization is crucial as it ensures that resources, including time and financial investments, are directed towards mitigating the most significant risks, thereby enhancing the organization's overall risk management strategy.

The effective allocation of resources based on risk assessment allows organizations to implement risk mitigation measures that align with their risk appetite and available resources. This strategic approach not only protects the organization from potential losses but also supports sustainable growth by ensuring that risk management efforts are proportionate and targeted.

In contrast, options related to resetting risk management strategies on a yearly basis, evaluating employee performance, or enforcing compliance focus on aspects that are secondary to the core purpose of risk assessment, which is fundamentally about prioritization and resource allocation. These other activities can be important in their own right but do not capture the primary objective of risk assessment within ORM.