Final answer:
Compliance risk involves the management of legal issues related to diversity, health and safety, union relations, whistleblowers, and harassment. The correct answer is option a.
Step-by-step explanation:
The type of risk management that involves consideration of legal issues, such as diversity, health and safety, union relations, whistleblowers, and harassment, is known as compliance risk. This is because compliance risk pertains to the potential for financial loss, legal or regulatory penalties, or material damage resulting from a failure to comply with laws, regulations, and prescribed practices, including those that govern the treatment of employees and the workplace environment. In contrast to other types of risks like financial, operational, or strategic risks, compliance risk specifically deals with adherence to laws and regulations.
Within the context of Human Resources, Institutional & Corporate Management, Equal Opportunity Programs, and Security Management & Safeguards, ensuring compliance is crucial. These areas are directly tied to legal requirements that a company might face, including, but not limited to, anti-discrimination laws, workplace safety standards, rules governing interactions with unions, policies around reporting misconduct, and regulations pertaining to harassment.
Therefore, the correct option in this context is C. compliance risk. It is the responsibility of an organization to actively manage compliance risk by setting up appropriate policies and procedures designed to prevent, detect, and correct any potential breaches of regulations or company standards.