Assignment:
Brisk Holdings, a large conglomerate is implementing the enterprise risk management (ERM) framework to quantify and manage the risk-return tradeoff for the entire firm. Which of the following statements about the ERM framework is/are correct?
I. The performance of each business unit should be evaluated on a stand-alone basis and the unit should be allocated more capital if its net income is positive.
II. The ERM framework tries to minimize the aggregate risk taken by the firm.
a. Statement I only
b. Statement II only
c. Both statements are correct
d. Both statements are incorrect