Continuous Risk Monitoring
Many companies fall into the trap of focusing on risk identification over risk mitigation. Identification without mitigation or a plan of action may even incur liability on the business in the event of an incident from a known risk. Five steps to an effective risk management system:
Identify the risk.
Evaluate and treat the risk (Accept-Avoid-Transfer-Mitigate)
Implement controls to prevent the same risk from re-occurring.
Update policies, procedures, and employee training.
Continue to monitor for gaps and improvement.
Introduction
Last week we discussed the value of an independent risk assessment, today we focus on the next layer of risk management - Continuous risk monitoring - a critical component of any effective risk management strategy. CRM goes beyond your point-in-time annual risk assessment to identify risks at any point in time across the business.
Through continuous risk monitoring, businesses can stay up-to-date on threats, identify potential risks, and take proactive steps to protect their operations and reputation. With the right risk monitoring tools and processes, businesses can develop an effective risk management system that helps them stay compliant and protect their investments.
What is continuous risk monitoring?
Simply put, continuous risk monitoring is a process that enables businesses to monitor their risk levels over time, all the time. Continuous monitoring is often used in combination with a risk assessment to identify potential risks that may not be apparent in a standard assessment. It is continually analyzing data to provide a current view of an organization’s risks, including threats and vulnerabilities.
Continuous risk monitoring can also be referred to as “real-time” risk monitoring, “ongoing” risk monitoring, or “dynamic” risk monitoring. Each of these terms refers to the same process, but each has a slight difference in meaning.
Benefits of continuous risk monitoring
- Real-time threat assessments - Continuous risk monitoring provides real-time threat assessments, which can help organizations respond to current threats and minimize the impact of an attack.
Continuous monitoring can also help organizations identify potential threats before they become a problem. To-whit. Continuous Risk Monitoring is not simply the identification of risk. Many companies fall into the trap of focusing on risk identification over risk mitigation. Identification without mitigation or a plan of action may even incur liability on the business in the event of an incident from a known risk.
How to use risk monitoring to stay compliant
Risk and compliance are symbiotic. Ideally, there is no (need for) compliance without risk. For example, if your workforce is remote and the company forgoes office space, there is no risk of the office burning down, so you no longer need a sprinkler system to protect your building. You can save a lot of time and money by evaluating your compliance obligations against your risk.
Similarly, compliance without risk management is largely a blindfolded approach to protecting your organization. If you are implementing a bunch of controls simply based on the certification standard in front of you without knowing or understanding your risk, then you best make sure you at least have a strong incident management policy!
Common risks that continuous monitoring can help identify
- Regulatory compliance risks - Regulatory compliance risks are risks that organizations could be fined or sanctioned for failing to follow applicable laws. Continuous monitoring can help businesses stay aware of new laws and identify potential risks related to regulatory compliance. - Reputation risk - Reputation risk refers to the risk of being negatively impacted by an issue that could affect an organization’s reputation or brand. Continuous monitoring allows businesses to stay aware of potential issues, like product recalls, service issues, and other problems that could potentially impact their reputation. - Financial and operational risk - Financial and operational risk refers to the risk of incurring financial losses due to data breaches or other problems. Continuous monitoring can help businesses stay aware of potential issues and identify potential threats before they become a problem. - Product risk - Finally, continuous monitoring can help businesses identify potential product risks. Product risks are risks related to a specific product, feature, or function. Continuous monitoring can help businesses stay aware of potential product risks and take proactive steps to address them.
How to develop an effective risk management system
Five steps to an effective risk management system, all of which start with an integrated, automated GRC platform
Identify the risk
Evaluate and treat the risk
Implement controls to prevent the same risk from re-occurring
Update policies, procedures and employee training
Continue to monitor for gaps and improvement