This component of the ERM framework that encompasses the tone of an organization and sets the basis for how risk is viewed and addressed by an entity's people, including risk management philosophy and risk appetite, integrity and ethical values and the environment in which they operate.
A) control activities
B) internal environment
C) risk assessment
D) risk response

Question

Quizplus · Accepted Answer

The internal environment component of the ERM framework encompasses the tone set by an organization and its people's risk management philosophy and risk appetite, integrity and ethical values, and the environment in which they operate. Control activities focus on specific actions taken to mitigate risks, risk assessment involves identifying and analyzing risks, and risk response involves developing a plan to address and mitigate risks.

This Component of the ERM Framework That Encompasses the Tone