The Chief Executive Officer (CEO) of a company has considered implementing a cost-saving measure that might result in new risk to the company. When deciding whether to implement this measure, which…

Question

Options

• APresent the detailed risk resulting from the change to the company's board of directors
• BPilot new mitigations that cost less than the total amount saved by the change
• CModify policies and standards to discourage future changes that increase risk
• DCapture the risk in a prioritized register that is shared routinely with the CEO

• A
  7% (3)
• B
  16% (7)
• C
  2% (1)
• D
  75% (33)

Explanation

When a CEO is considering a change that introduces new risk, the organization must manage - not necessarily eliminate - that risk. Capturing the risk in a prioritized risk register shared routinely with the CEO (D) is the best approach because it ensures the risk is formally documented, visible, tracked over time, and consistently in front of the decision-maker who owns the business risk. This supports informed governance without overriding the CEO's authority to accept risk. Option A (presenting to the board) may be appropriate for significant risks but is not a routine management control. Option B (piloting cheaper mitigations) assumes the risk must be mitigated rather than accepted, and is premature. Option C (modifying policies to discourage future changes) is reactive and bureaucratic, not a risk management action for the current decision.

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