Certified Governance Risk and Compliance (CGRC) Practice Exam 2025 - Free CGRC Practice Questions and Study Guide

The primary purpose of conducting a risk assessment is to identify potential hazards and assess risks. This process involves systematically examining what could go wrong in a project or an organization, understanding the nature of those risks, and evaluating the likelihood and impact of their occurrence. By identifying these risks, organizations can take proactive steps to mitigate them, thus ensuring better decision-making, improved safety, and reduced liabilities.

Risk assessments play a crucial role in governance, risk management, and compliance since they help organizations prioritize their risk management efforts and allocate resources more effectively toward the areas that require the most attention. This strategic focus is essential for maintaining compliance with regulations and enhancing overall organizational resilience. While establishing a plan for project funding, determining the project schedule, and allocating resources can be important aspects of project management, they are not the core objective of a risk assessment, which centers on identifying and evaluating risks.