What role does leadership play in ORM?

Leadership plays a critical role in Operational Risk Management (ORM) by setting the tone and culture necessary for effective risk management within an organization. When leaders prioritize ORM, they create an environment where safety, accountability, and proactive decision-making are emphasized. This includes fostering open communication about risks and encouraging team members to participate in identifying and managing those risks.

By establishing a risk-aware culture, leaders enable everyone in the organization to understand their role in ORM and to feel empowered to contribute to safety measures and risk management processes. The commitment of leadership to ORM ensures that both immediate actions and long-term strategies align with best practices in risk management.

The other options suggest a narrower view of leadership's responsibilities. While compliance with safety regulations and financial outcomes are important, they do not encompass the broader cultural and behavioral influences that leadership has on ORM practices. Similarly, merely delegating ORM responsibilities to junior staff lacks the necessary involvement and commitment from leadership that is essential in maintaining an effective ORM program.