Which of the following is a key component of a risk management strategy?

The selection of identifying and assessing risks as a key component of a risk management strategy is correct because it forms the foundation for effective risk management. This process involves recognizing potential threats that could impact the organization, evaluating the likelihood and potential impact of these risks, and determining their significance in relation to the organization's objectives.

By identifying and assessing risks, an organization can prioritize which risks need immediate attention and develop appropriate strategies to mitigate them. This proactive approach is essential to minimizing adverse effects on operations, finances, and reputation. Furthermore, understanding the risk landscape enables better allocation of resources to manage those risks effectively and supports informed decision-making.

In contrast, while building a brand identity, optimizing supply chain efficiency, and conducting market research are important business endeavors, they do not serve as core components of a risk management strategy. These activities focus more on enhancing market position and operational effectiveness rather than specifically addressing the identification and mitigation of risks.