Which of the following best describes "risk mitigation"?

The best description of "risk mitigation" is the process of reducing both the impact and the likelihood of risks. This involves implementing strategies that either lessen the potential negative consequences of risks or decrease the chances of those risks occurring in the first place. Effective risk mitigation acknowledges that while risks cannot always be entirely eliminated, organizations can take proactive steps to manage them.

For instance, organizations might conduct risk assessments, develop contingency plans, and implement controls or policies that aim to minimize risks, ensuring a more resilient operating environment. By focusing on reduction rather than elimination, risk mitigation allows businesses to prioritize resources and strategies for their most critical risks while accepting the inherent uncertainties of any operational setting.

This approach is particularly valuable because it fosters a balanced perspective on risk-taking, highlighting the importance of preparedness without creating an overly cautious culture that stifles innovation and growth.