What are risk taxonomies?

A risk taxonomy is a comprehensive, common and stable set of risk categories that is used within an organization. By providing a comprehensive set of risk categories, it encourages those involved in risk identification to consider all types of risks that could affect the organization’s objectives.

What are the 4 risk categories?

One approach for this is provided by separating financial risk into four broad categories: market risk, credit risk, liquidity risk, and operational risk.

What are the 6 types of risk?

Riskology

  • Health and safety risk. General health and safety risks can be presented in a variety of forms, regardless of whether the workplace is an office or construction site. …
  • Reputational risk. …
  • Operational risk. …
  • Strategic risk. …
  • Compliance risk. …
  • Financial risk.

What are the five classifications of risk?

Based on this, financial risk can be classified into various types such as Market Risk, Credit Risk, Liquidity Risk, Operational Risk, and Legal Risk.

What is a prompt list?

A Prompt List is checklist with a category of risk. This tool is a simple series of broad risks, such as Environmental or Legal, rather than specific risks, like flooding or regulatory changes. The idea is to push (prompt) you to think and brainstorm of risks in groups and eventually prioritize them.

What is operational risk examples?

Examples of operational risk include: Employee conduct and employee error. Breach of private data resulting from cybersecurity attacks. Technology risks tied to automation, robotics, and artificial intelligence. Business processes and controls.

What are the 3 risk categories?

The 3 Basic Categories of Risk

  • Business Risk. Business Risk is internal issues that arise in a business. …
  • Strategic Risk. Strategic Risk is external influences that can impact your business negatively or positively. …
  • Hazard Risk. Most people’s perception of risk is on Hazard Risk.

What are the 4 principles of risk management?

Four principles

Accept risk when benefits outweigh the cost. Accept no unnecessary risk. Anticipate and manage risk by planning. Make risk decisions in the right time at the right level.

What are the 4 risk strategies?

There are four main risk management strategies, or risk treatment options:

  • Risk acceptance.
  • Risk transference.
  • Risk avoidance.
  • Risk reduction.

What are the 3 types of mitigation?

The types of mitigation enumerated by CEQ are compatible with the requirements of the Guidelines; however, as a practical matter, they can be combined to form three general types of mitigation: avoidance, minimization, and compensatory mitigation.

What are the five risk control strategies?

These five methods of controlling risk will provide you with the options needed to better control the fallout from unplanned events or scenarios.

  • Avoidance. …
  • Acceptance. …
  • Mitigation. …
  • Transferal. …
  • Exploitation.

What are the five risk mitigation strategies?

Five risk mitigation strategies with examples

  • Assume and accept risk. …
  • Avoidance of risk. …
  • Controlling risk. …
  • Transference of risk. …
  • Watch and monitor risk.

What are the different methods of handling risk?

The 5 Methods for Handling Risk

  • Control. We can minimize our exposure to risk as we limit the opportunity for losses to occur. …
  • Avoidance. We can completely take the risk out of the equation by opting to never get involved in the first place. …
  • Retention. …
  • Non-Insurance Transfer. …
  • Buy insurance.

What are examples of risk response?

Table of risk responses

Risk Response Description/example
Reduce Action is taken to reduce either the likelihood of the risk occurring or the impact that it will have.
Accept The risk may be accepted perhaps because there is a low impact or likelihood. A contingency plan will be identified should it occur.