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ACCA Strategic Professional · Strategic Business Leader · Managing, monitoring and mitigating risk

Hartwell Retail Ltd's risk manager notes that the ISO 31000 standard on risk management differs from a compliance checklist. Which feature of ISO 31000 is most accurate?

ISO 31000 provides generic guidance made up of principles, a framework and a risk management process that any organisation can tailor. It is not a certifiable requirements standard, is not limited to financial institutions, and does not prescribe a particular risk appetite.

  1. AIt gives mandatory certifiable requirements that a company must pass to be accredited
  2. BIt provides generic principles, a framework and a process, and is not intended for certificationCorrect
  3. CIt applies only to financial institutions regulated by central banks
  4. DIt prescribes the exact risk appetite level a company must adopt

Explanation

ISO 31000 offers guidelines: principles, a framework and a process applicable to any organisation. It is not a certification standard, is not sector-specific, and does not dictate appetite, which each organisation sets itself.

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