Explanation:
In the widely adopted “three lines of defense” model (endorsed by the Basel Committee), the first line consists of the business units and front-line staff who actually take on and generate risks as part of their normal operations. They are responsible for identifying, assessing, and managing those risks on a day-to-day basis. The second line (risk management and compliance) provides oversight, policy, and challenge, while the third line (internal audit) delivers independent assurance.
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Q.6952 The “three lines of defense” model in enterprise risk management assigns primary responsibility for day-to-day risk identification, assessment, and management to which group?
A
The board of directors and senior management
B
Internal audit (third line)
C
The business units that originate and own the risks
D
The independent risk management function (second line)
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