Certified Supply Chain Professional (CSCP) Practice Exam

What does the GRC framework encompass?

1. Governance, Risk Management, Compliance

2. Governance, Resource Control, Compliance

3. Government Regulation Compliance

4. Global Risk Control

The correct answer is: Governance, Risk Management, Compliance

The GRC framework encompasses Governance, Risk Management, and Compliance, which are integral components for organizations aiming for effective operational management. Governance refers to the structures and processes for decision-making, accountability, and behavior within an organization. It ensures that the organization is directed and controlled in a way that aligns with its goals and objectives while considering the interests of stakeholders. Risk Management involves identifying, assessing, and mitigating risks that could impede the achievement of an organization's objectives. This process helps organizations to understand potential threats and vulnerabilities, thereby allowing them to develop strategies to minimize impacts. Compliance pertains to the adherence to laws, regulations, and internal policies that govern the operation of the organization. Ensuring compliance is essential for maintaining the organization's reputation, avoiding legal penalties, and fostering trust among stakeholders. Together, these elements create a cohesive approach to managing an organization’s governance, risk, and compliance activities, leading to improved decision-making, enhanced risk awareness, and effective adherence to regulations. This holistic view is essential for leveraging business opportunities while navigating challenges and uncertainties.