Glossary

Information Security Risk

Information technology is an excellent opportunity for businesses to increase their capabilities, but it’s also a significant source of organizational risk. Data breaches, for instance, cost businesses $4.24 million in 2021 according to IBM.

And data breaches aren’t the only threat. IT security risks can range from financial losses, sanctions due to regulatory noncompliance, and harm to your reputation amongst clients and business partners.

Learning to identify and address information security threats will become an invaluable skill in the next few decades, so take the time to go over IT-related risks and how to assess them both within your own organization and within the third-party companies that you work with.

Information Security Risk

Information Security Risk Types

Companies are just as susceptible to the same cybersecurity and IT risks as many individuals. Those can range from:

  • Viruses and malware being installed by accident on corporate machines, resulting in blocked access to critical resources or data theft.
  • Denial of service attacks that flood a corporate computer network to render it inoperable.
  • Phishing attempts that trick employees to giving up funding or sensitive information to malicious entities.
  • Social engineering likewise encourages employees to give out sensitive passwords to third-parties without the proper authorization.

There are many more IT-related risks to watch out for, in fact. From man-in-the-middle attacks to SQL injections, the large diversity of information security risks only emphasizes the need for risk management in modern business.

What Does the Framework For an Information Security Risk Assessment Look Like?

Risks clearly differ from company to company, but you can expect a regular framework like the one below for conducting IT-related risk assessments.

  • Identification: Discover where current and potential future risks could be and analyze their potential impact. Based on risk severity and likelihood of occurrence, prioritize your risks so that you can focus most of your attention on the areas that matter.
  • Prevention: Businesses mitigate their risks by implementing internal controls and policies to prevent them. An action plan should also be developed for incident response.
  • Assessment: Keep detailed documentation on all your efforts, including your risk assessment, corrective actions, and internal controls. Doing so minimizes confusion over your intentions and informs everyone about your efforts.

As information security risks change over time, new risk assessments must be made regularly to adjust policies and controls over time.

Start Getting Value With
Centraleyes for Free

See for yourself how the Centraleyes platform exceeds anything an old GRC
system does and eliminates the need for manual processes and spreadsheets
to give you immediate value and run a full risk assessment in less than 30 days

Best Practices For Information Security Risk Management

Information security itself is already a complicated topic, and the risks associated with it can be challenging to address, especially as the market for IT risk management is relatively new. The following best practices have currently seen success in various industries to date.

Send Out Security Questionnaires

IT security covers not only your own company but also any third-parties you work with, whether they’re suppliers or business partners.

The next time you plan on partnering with a new organization, send it an information security questionnaire (you can automate this process) to help assess the general risk level of the company and plan out ways you both can work together to reduce IT risk. Such a questionnaire will cover topics ranging from:

  • Auditing procedures
  • Identity and access management
  • Encryption
  • Employee policies
  • Supply chain management
  • Governance, Risk, and Compliance (GRC) topics

Since you can be held liable for damages incurred from a partner’s security incident, make this questionnaire comprehensive to reduce risk and liability.

Analyze Your Business Partners

The purpose of an initial risk assessment and a questionnaire is to identify the assets of a company, its threats and vulnerabilities, and any controls in place for risk remediation.

IT assets, which comprise resources like data and systems, are typical targets for cybercriminals. Vulnerabilities are the weaknesses in those assets that generate risk for the company and its partners. Identify what controls you can place to help lessen these vulnerabilities.

When working with a new vendor, also make sure that it is responsive to your communications. You must both agree on accountability when it comes to engaging in IT risk management.

Work On Incident Response

Knowing how to respond to discovered risks is just as important as detecting them initially. There are 4 main types of risk response:

  • Avoidance: Perhaps the most straightforward response is to avoid the risk entirely, though doing so may also cut yourself off from otherwise beneficial business partnerships.
  • Outsourcing: Say a company purchases IT insurance for cybersecurity threats. The risk is pushed onto a third-party, which will help mitigate the risk of malware or viruses for the client organization.
  • Sharing: A similar strategy to outsourcing, sharing risk involves working with a third-party contractor to help manage the risk. For instance, signing up with the cloud storage solution Microsoft Azure allows both the client and Microsoft to work together to protect the partnership.
  • Acceptance: Risk is unavoidable. And sometimes, taking risks is necessary to fuel growth and take advantage of opportunities. It’s up to your team whether accepting a degree of risk is worth the tradeoff.

Your ideal response depends on the nature of the risk, so consider your course of action on a case-by-case basis.

Information Security Risk Software

Using modern software designed for modern IT risk management will ensure you have all risks covered: identified, prioritized, mitigated and monitored. See for yourself what can be done using an automated risk management software like Centraleyes

Start Getting Value With
Centraleyes for Free

See for yourself how the Centraleyes platform exceeds anything an old GRC
system does and eliminates the need for manual processes and spreadsheets
to give you immediate value and run a full risk assessment in less than 30 days

Related Content

Supply Chain Compliance

Supply Chain Compliance

A supply chain is a delicate structure composed of multiple companies, decision-makers, and suppliers all working…
Compliance Automation Software

Compliance Automation Software

Security and compliance have always been critical tasks in business operations, and management teams have always…
Cybersecurity Risk Analysis

Cybersecurity Risk Analysis

A cyber risk analysis will involve looking at each and every cyber security related risk in…