What is "risk management," and why is it important in the project environment?

Risk management is known as or referred to as the prioritization, identification and evaluation of risks that is further followed by an economical and coordinated features of resources in order to monitor, minimize, and thus control probability and the impact of the unfortunate events and to maximize its realization of the opportunities.

It is important in project environment because an effective risk management tends to allow one to identify their project's opportunities strengths, weaknesses and threats. By planning and plotting in case of an unexpected event, one can get ready in order to respond if such situation arises.