Final answer:
ORM is designed to mitigate or minimize risks not to eliminate them entirely or increase them. Organizations use various strategies, such as installing safety systems or reducing greenhouse gas emissions, to lessen the likelihood and impact of potential risks.
Step-by-step explanation:
Operational Risk Management (ORM) is a process used within organizations to identify, evaluate, control, and mitigate risks associated with their daily operations. The correct answer to the question posed is C. Mitigate or minimize risks. ORM does not necessarily eliminate all risks, as it would be nearly impossible and sometimes counterproductive to try to do so. Instead, ORM strategies focus on reducing the likelihood of risk events occurring and minimizing the impact of those events if they do occur.
Take the example of climate change, where by making decisions that reduce greenhouse gas emissions, we mitigate the risks associated with climate-related changes. In the context of insurance, businesses can take measures such as installing security and fire sprinkler systems, which can lower their insurance rates while simultaneously reducing the risk of damage to their property. Similarly, the concept of moral hazard is mitigated in the insurance industry through measures like routine inspections and investigations to prevent fraud.