Ace the 2026 Certified Governance Risk & Compliance (CGRC) Challenge – Navigate the Governance Maze with Confidence!

The correct response is the watchlist, as it is specifically designed to monitor risks that have been identified with low ratings of probability and impact. By placing these risks on a watchlist, organizations maintain oversight without expending excessive resources on risk management for threats that are unlikely to materialize or have a minimal effect if they do.

Risks that are considered low in both probability and impact do not necessitate immediate, detailed actions, but they may still be significant enough to warrant future observation. The watchlist serves this purpose by allowing risk managers to periodically review and reassess these risks, ensuring that if the situation changes, appropriate actions can be taken.

The other options focus on different aspects of risk management. For example, a risk alarm typically refers to significant risks that require immediate attention and action, rather than low-rated risks. An observation list is often a more informal collection of risks to monitor but might not be as structured as a watchlist. Lastly, a risk register maintains a comprehensive record of all identified risks and their current status, but it tends to prioritize higher-rated risks over lower ones for active management. Therefore, the watchlist is the most appropriate choice for monitoring low-rated risks.