Financial Risk Manager Part 1

Explanation

The correct answer is B because the silo approach to risk management allows individual business units within an organization to specialize in managing their specific risks. This specialization leads to the development of a diverse range of risk management expertise within the organization.

Key Points:

• Specialization: Each business unit can become highly skilled in managing its unique risks
• Diverse Expertise: Promotes development of rich variety of risk management skills across the organization
• Ownership and Accountability: Fosters culture where each unit takes responsibility for its own risks
• Thorough Analysis: Enables detailed focus on specific risk landscapes without distraction from broader organizational risks

While options A, C, and D may seem plausible, they don't capture the core advantage of specialization and expertise development that makes siloed risk management attractive to some companies compared to Enterprise Risk Management (ERM).