Browse Definitions:
Definition

business risk

Contributor(s): Ivy Wigmore

A risk, in a business context, is anything that threatens an organization's ability to generate profits at its target levels; in the long term, risks can threaten an organization's sustainability.

Business risks are broadly categorized as pure risks, which are negative events over which the organization has no control, and speculative risks, which are potential effects of actions taken and choices made that may have positive and/or negative effects. Another model categorizes business risks as internal (resulting from events with the organization) and external (resulting from events occurring outside the organization).

According to security expert Shon Harris, once a business risk has been identified, an organization has four options: transfer it, avoid it, reduce it or accept it.

Risk analysis programs are designed to help an organization deal as effectively as possible with existing or potential threats. The four main elements of risk analysis are:

  • Identifying corporate assets and assessing their value.
  • Identifying vulnerabilities and threats to the security of those assets.
  • Quantifying the probability of those threats and their potential impact on the business.
  • Compare the potential economic impact of the threat versus the cost of the countermeasures required to protect the organization from it.

See also: Types of enterprise risk

 

This was last updated in October 2014

Continue Reading About business risk

Start the conversation

Send me notifications when other members comment.

By submitting you agree to receive email from TechTarget and its partners. If you reside outside of the United States, you consent to having your personal data transferred to and processed in the United States. Privacy

Please create a username to comment.

-ADS BY GOOGLE

File Extensions and File Formats

SearchCompliance

  • internal audit (IA)

    An internal audit (IA) is an organizational initiative to monitor and analyze its own business operations in order to determine ...

  • pure risk (absolute risk)

    Pure risk, also called absolute risk, is a category of threat that is beyond human control and has only one possible outcome if ...

  • risk assessment

    Risk assessment is the identification of hazards that could negatively impact an organization's ability to conduct business.

SearchSecurity

  • phishing

    Phishing is a form of fraud in which an attacker masquerades as a reputable entity or person in email or other communication ...

  • vulnerability disclosure

    Vulnerability disclosure is the practice of publishing information about a computer security problem, and a type of policy that ...

  • incident response

    Incident response is an organized approach to addressing and managing the aftermath of a security breach or cyberattack, also ...

SearchHealthIT

SearchDisasterRecovery

  • business continuity and disaster recovery (BCDR)

    Business continuity and disaster recovery (BCDR) are closely related practices that describe an organization's preparation for ...

  • business continuity plan (BCP)

    A business continuity plan (BCP) is a document that consists of the critical information an organization needs to continue ...

  • call tree

    A call tree -- sometimes referred to as a phone tree -- is a telecommunications chain for notifying specific individuals of an ...

SearchStorage

  • flash memory

    Flash memory, also known as flash storage, is a type of nonvolatile memory that erases data in units called blocks.

  • NAND flash memory

    NAND flash memory is a type of nonvolatile storage technology that does not require power to retain data.

  • NOR flash memory

    NOR flash memory is one of two types of nonvolatile storage technologies.

SearchSolidStateStorage

  • hybrid hard disk drive (HDD)

    A hybrid hard disk drive is an electromechanical spinning hard disk that contains some amount of NAND Flash memory.

Close