Hannah is concerned about which type of risk that relates to strategic decisions impacting future growth?

Strategic risk is the type of risk that pertains to the decisions made at the highest levels of an organization that significantly affect its direction and long-term growth. This encompasses risks associated with entering new markets, launching new products, and making high-stakes business decisions that could influence the overall strategy and success of the organization.

For instance, if a company decides to pivot its business model or invest in a new technology, it is engaging in strategic risk because these choices can lead to either significant growth or substantial setbacks in achieving its objectives. Understanding and managing strategic risk is crucial for leaders to ensure that their decisions align with the long-term vision of the company and do not impede future growth.

In contrast, operational risk relates to day-to-day operations and the potential for losses stemming from inadequate or failed internal processes. Preventable risk refers to risks that can be eliminated or significantly reduced by improving management practices. Compliance risk involves the possibility of being penalized for failing to comply with regulations or laws. While these factors are important, they do not primarily concern future growth in the same way as strategic risk does.