What is Involved in Risk Management?

Risk Management is more then just doing a Risk- Preventive: attempt to avoid the occurrence of
Assessment... risk management is the process ofunwanted events (inhibit attempts to violate
identifying assets and risk, assessing risk, taking stepsinformation security).
to reduce risk to an acceptable level, and monitoring- Detective: attempt to identify unwanted events
to ensure success. Monitoring closes the loop andafter they have occurred (warn of violations or
helps identify new security requirements; you'll neverattempted violations).
be finished with risk management, any more then- Deterrent: attempt to discourage threat agents
you'll every be finished with managing your personnelfrom violating information security.
or your money or infrastructure.- Corrective: attempt to remedy the circumstances
Information is an asset which, like other importantthat allowed the event, or return conditions to what
business assets, has value and consequently needs tothey were.
be suitably protected. The protection of information- Recovery: attempt to restore lost resources or
includes the three security objectives ofcapabilities and help recover monetary losses.
confidentiality, integrity, and availability, and the- Containment: attempt to limit the impact (injury or
business requirement of acceptable use. Informationloss).
security protects information from a wide range ofFor each of the three objectives (CIA), there are a
threats in order to ensure business continuity,total of three types of safeguards (APL) each with a
minimize business damage, and maximize return onpossibility of 6 controls (PDDCRC); a total of 54
investments and business opportunities.possibilities... lots for you to choose from to protect
Information can exist in physical, electronic, oryour information.
intellectual form. It can be printed or written onThe primary objective or end result of all of this is to
paper, stored electronically, transmitted by post orget the appropriate protection in place to reduce risk
using electronic means, shown on films, or spoken into an acceptable level. The acceptable risk level is
conversation. Whatever forms the information takes,based on the business impact that would be
or means by which it is shared or stored, it shouldexperienced if certain risks were realized. The
always be appropriately protected.following list could be used as a basis for determining
Risk is the net negative impact of the exercise of awhen a risk is acceptable or, perhaps, tolerable. A risk
vulnerability, considering both the likelihood and theis acceptable when:
impact of occurrence. The ultimate goal of risk- it falls below an arbitrary defined probability,
management is to identify the security and privacy- it falls below some level that is already tolerated,
requirements to protect information assets and to- it falls below an arbitrary defined fraction of total
implement cost-effective safeguards required torevenue for the company,
meet those requirements.- the cost of reducing the risk would exceed the
As mentioned above, the primary requirements forcosts saved,
information security are the protection of- the cost of reducing the risk would exceed the
confidentiality, integrity, and availability (the CIA triad);costs saved when the 'costs of suffering' are also
and the concept of "need to know" or "acceptablefactored in,
use" of the information. If CIA is compromised the- the opportunity costs would be better spent on
information asset can be inappropriately disclosed,other, more pressing, company issues,
modified, or destroyed and is considered a risk to the- executive, senior management, or the board say it
company. Inappropriate use could also pose a risk tois acceptable,
the company. A balance must be struck between- the general public say it is acceptable (or more
openness of access to information for "missionlikely, do not say it is not),
accomplishment" (i.e. what's required to "do my job")- politicians, via legislation, say it is acceptable.
and locking the information down too tightly. OnceTo set a company wide acceptable risk level you
identified, risk can be handled in a number of ways,must understand your legal requirements, your
including: ignore, avoid (prevent), mitigate (reduce),regulatory requirements, your business drivers and
transfer, or accept.objectives, and you must carry out threat risk
Information security, or more specifically "riskassessments for your sensitive and critical information
mitigation", is achieved by implementing a suitable setassets.
of safeguards, which could be (APL):In summary then the full process to follow is:
- administrative: policies, practices, procedures, org
structures, awareness and training;1. identify your information assets and potential
- physical: locks, guards, badge access, firethreats and risks (natural or man-made),
suppression, flood control;2. conduct a threat risk assessment to determine
- logical: computer or technology related securityrecommended safeguards,
functions.3. take the steps necessary to reduce risk to an
Safeguards are also referred to as security controlsacceptable level,
or countermeasures (or just measures). Each of4. monitor the usage of your information to ensure
these can have a number of Security Controls assuccessful protection.
follows (PDDCRC):