MCS 3040 Chapter Notes - Chapter 3: Legal Advice, Insurance Policy, Debt Management Plan
15 Oct 2012
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Document Summary
A business must be able to analyze and evaluate its activities, forecast changes in the business environment and react effectively to unexpected developments. Preventative approach requires a thorough evaluation of the risks associated with the business" activities, in order to minimize their impact (emphasis on compliance with legal requirements, and anticipation of changes in the legal environment) Reactive approach recognizes that legal problems may still materialize, so the firm needs a strategy in place to deal with such developments. These two approaches are combined in a management plan that reduces the impact of legal risks on the organization. Legal risk: a business risk with legal implications. A comprehensive action plan for dealing with the legal risks involved in operating a business. This process is often part of a broader exercise within an organization . Enterprise risk assessment, in which all risks are assessed and managed. Risk management involves the cooperation of managers and others at every level of the organization.
