CORES CORES Operational Risk Governance & Framework Design

Question 1

Which body is primarily responsible for setting the overall tone and oversight of operational risk governance at the enterprise level?

Accepted Answer

The board of directors

Answer

The board of directors bears ultimate responsibility for setting the risk appetite and overseeing the operational risk governance framework.

Question 2

In the three lines of defense model, which line is responsible for owning and managing operational risk in day-to-day business activities?

Accepted Answer

First line — business units

Answer

The first line of defense consists of business unit managers and staff who own and manage risks in their daily operations.

Question 3

What is the primary purpose of a Risk Appetite Statement (RAS) in an operational risk framework?

Accepted Answer

To define the amount and type of risk the organization is willing to accept

Answer

A Risk Appetite Statement articulates the level and types of risk an organization is willing to tolerate in pursuit of its strategic objectives.

Question 4

Which operational risk framework component ensures that risk management policies are consistently applied across all business lines?

Accepted Answer

Risk governance structure

Answer

A robust risk governance structure—with clear roles, policies, and escalation paths—ensures consistent application of risk management practices enterprise-wide.

Question 5

Under the CORES framework, what distinguishes a 'risk owner' from a 'risk manager'?

Accepted Answer

Risk owners are accountable for the risk outcome; risk managers provide oversight and tools

Answer

Risk owners are accountable for outcomes within their business area, while risk managers in the second line provide frameworks, tools, and oversight.

(CORES) Certified Operational Risk Executive Specialist Practice Test

(CORES) Certified Operational Risk Executive Specialist Practice Test

CORES CORES Operational Risk Governance & Framework Design