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Key risk indicator

Key risk indicator definition

A key risk indicator is a metric used to assess and measure possible risks. It allows businesses to track their risk profile. For example, analyzing threats and vulnerabilities of the tools a company uses will allow it to assess how likely a cyberattack is. If two tools have minor vulnerabilities, the risk is low, but if four or five of them have major security flaws, the business may want to take some steps to prevent an attack.

Key risk indicator categories

  • Operational. Evaluating risks that can occur at any time, like malfunctions or cyberattacks.
  • Financial. Evaluating financial risks related to the market, laws, regulations, or competition.
  • People. Evaluating risks a business might face because of people, like customer and employee satisfaction and retention.