Glossary definition: Risk

Management Risk Management: Strategies for Reducing Risk

Risk is the potential for loss or harm that can be caused by making a decision or taking an action. It is the uncertainty of an outcome or the potential of suffering harm or loss. Risk can be both positive and negative; it can include financial, physical, psychological, and legal risks. Risk can be managed through an assessment of the potential outcomes, the likelihood of each outcome, and the consequences of each outcome. Risk management involves identifying, assessing, and managing risks, as well as developing strategies to minimize or prevent potential losses. Risk management is a critical part of any business, organization, or individual's decision-making process.