Which of the following describes components of the risk-management process?

Framing risk is a crucial component of the risk management process because it establishes the context in which the organization will assess and manage risks. This step involves identifying the risk landscape specific to the organization's objectives and operational environment. By framing risk, the organization defines the scope of risk management, including what risks are relevant, the criteria for evaluating those risks, and the stakeholder perspectives that should be considered.

Framing also helps in articulating the organization’s risk appetite—essentially outlining how much risk the organization is willing to accept in pursuit of its objectives. This clear framework allows for more effective assessment, monitoring, and response to risks that arise.

Understanding the framing of risk provides clarity and structure in how other components—such as assessing, monitoring, and responding to risk—are effectively executed. These phases must align with the foundation set during the risk framing process to ensure coherent and consistent handling of risks.