Operational Risk
Operational Risk is the risk of loss resulting from inadequate or failed internal processes, people, systems, or external events.
Benefits
Managing operational risk helps businesses prevent losses, improve process reliability, ensure compliance, and enhance overall operational stability.
Frequently Asked Questions
What is operational risk the risk of loss resulting from?
Operational risk is the risk of loss resulting from inadequate or failed internal processes, people, systems, or external events.
Is operational risk internal or external?
Operational risk can be both internal and external, arising from internal processes and systems or external events and circumstances.
What are the 4 causes of operational risk?
The four causes of operational risk are people (human error or fraud), processes (inefficient or faulty procedures), systems (technology failures), and external events (natural disasters or market changes).
Key Takeaway
Operational Risk involves potential losses from internal and external failures, and effective management helps ensure business stability and reliability.