Imagine that you are the Chief Financial Officer (CFO) of a mid-sized company. You have been tasked with identifying the areas where your company is exposed to risk. You need to mitigate this risk. What approach would you take in the risk management process and why?

1. As the CFO, explain why the steps in the risk management process are important. Give an example of the three-step approach to risk management for a company.
2. Name three or more common risks that a company might face and appraise some of the implications if the company decides not to plan for each identified risk.