Tier 2 risk decisions are guided by decisions in which tier?

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Multiple Choice

Tier 2 risk decisions are guided by decisions in which tier?

Explanation:
Risk decisions follow a top-down governance flow: the highest tier sets the direction, and the lower tiers translate and implement it. Tier 1 defines the organization’s risk posture, policies, and risk appetite. Tier 2 must make risk decisions that align with and implement those Tier 1 directives. That’s why Tier 2 is guided by Tier 1—so risk decisions remain consistent with the overall risk strategy. Tier 3 handles the day-to-day implementation and monitoring based on Tier 2 decisions, not the other way around. While all levels influence outcomes, the guiding influence for Tier 2 comes from Tier 1.

Risk decisions follow a top-down governance flow: the highest tier sets the direction, and the lower tiers translate and implement it. Tier 1 defines the organization’s risk posture, policies, and risk appetite. Tier 2 must make risk decisions that align with and implement those Tier 1 directives. That’s why Tier 2 is guided by Tier 1—so risk decisions remain consistent with the overall risk strategy. Tier 3 handles the day-to-day implementation and monitoring based on Tier 2 decisions, not the other way around. While all levels influence outcomes, the guiding influence for Tier 2 comes from Tier 1.

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