What does risk monitoring and control involve?

Risk monitoring and control primarily involves tracking the effectiveness of risk management strategies. This process ensures that organizations continuously evaluate the measures they have implemented to mitigate risks, helping to determine whether these strategies are achieving the desired outcomes. By constantly monitoring the environment and assessing existing controls, organizations can adapt their strategies to changing circumstances, making necessary adjustments to improve risk management processes.

In contrast, regularly updating insurance policies is a component of risk management but focuses more on coverage rather than the overarching strategy. Assessing financial loss alone is too narrow, as it fails to encompass the broader picture of risk management, which includes a variety of factors beyond just monetary implications. Lastly, developing new risks is not a goal of risk monitoring and control; it rather focuses on managing and mitigating existing risks, rather than creating new ones. Thus, focusing on the tracking of risk management strategies' effectiveness is fundamental to maintaining a robust risk management framework.