What relevance do the Basel Accords have to ORM?

The Basel Accords are significant to operational risk management primarily because they set forth a framework specifically aimed at the banking sector. These accords, established by the Basel Committee on Banking Supervision, outline the approaches that banks must take to manage various types of risks, including operational risk. The Basel II and Basel III frameworks include specific requirements for capital adequacy, risk management practices, and the governance of operational risks that banks should adhere to.

Focusing on operational risk, the Basel Accords encourage financial institutions to identify, assess, monitor, and mitigate those risks effectively, which can arise from inadequate or failed internal processes, people, systems, or from external events. This structured approach assists in enhancing the overall stability of the banking system, ensuring that banks can withstand financial stress and protect depositors and the global economy.

In contrast to the other provided choices, the Basel Accords do not focus on the airline industry, do not dictate global trade regulations, and are not directly centered on corporate governance standards outside of their implications for banking operations. Therefore, the relevance of the Basel Accords is strongly tied to the management of operational risks within the banking sector.