What is a crucial outcome of effective risk management?

Enhanced organizational resilience is a crucial outcome of effective risk management because it allows an organization to better withstand, respond to, and recover from adverse events or disruptions. When risk management processes are effectively implemented, they enable organizations to identify potential risks early, assess their impact, and develop strategies to mitigate them. This proactive approach not only minimizes potential losses but also prepares the organization to navigate uncertainties, ensuring continuity of operations.

Organizations that prioritize effective risk management build a culture of awareness and preparedness, fostering agility in decision-making and the ability to adapt to changing environments. Enhanced resilience leads to sustained performance, safeguarding both assets and stakeholder interests during times of crisis.

The other options present scenarios that are undesirable outcomes. An increase in ethical dilemmas, a reduction in employee morale, and complexity in strategic decisions do not reflect the positive effects of well-managed risks and may actually stem from poor risk management practices.