The KPI that best measureseffectivenessof risk management is one that showsrisk alignment with tolerance levels.
CRISC defines:
“Risk management effectiveness is demonstrated when risk scenarios are managed within the organization’s defined tolerance.”
BandCare activity-based, not outcome-based.
Dmeasures realized losses, not ongoing control success.
Hence,A. The percentage of risk scenarios within organizational tolerancedirectly reflects program effectiveness.
CRISC Reference:Domain 4 – Risk and Control Monitoring and Reporting, Topic: Key Risk and Performance Indicators.
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