Final answer:
The statement that only the top ten risks should be actively managed is false, as ignoring smaller risks can lead to significant problems, as evidenced by the financial crisis of 2007-2008. All risks, particularly those with catastrophic consequences, should be managed appropriately regardless of their probability.
Step-by-step explanation:
The statement that only the top ten risks should be actively managed is False. Risk management is a critical aspect of project management, investment portfolios, and businesses in general. While prioritizing is necessary due to limited resources, ignoring lesser risks completely could be detrimental to the overall success of a project or investment. As the concept of asymmetric risk suggests, some risks, even if they have a low probability of occurring, can have catastrophic consequences if not managed. This principle is often applied in scenarios where the cost of inaction far outweighs the cost of taking preventive measures, even if the risky event may seem unlikely at the time.
Historically, there are numerous examples of where not addressing risks of all levels has had serious ramifications. One such example includes the financial crisis of 2007-2008, where the underestimation and poor management of mortgage-related risks led to a global economic downturn. Therefore, it's essential to assess and manage risks based on their potential impact and not just their ranking. By being conservative and preparing for low-probability but high-impact events, organizations can prevent devastating consequences to their portfolio.