Glossary definition: Risk Reduction

Risk Reduction: Strategies to Minimize Potential Losses

Risk Reduction is a process that seeks to reduce the probability and/or impact of an adverse event or outcome. It involves identifying risks and then taking steps to reduce or eliminate them. Risk reduction can be achieved through a variety of strategies, including avoidance, control, transfer, and/or acceptance. Avoidance means eliminating or avoiding the risk altogether. Control involves taking steps to reduce the likelihood of the risk occurring or the severity of its consequences. Transferring the risk involves transferring the responsibility for dealing with the risk to another party. Finally, risk acceptance means accepting the risk and its consequences and taking steps to minimize their impact. Risk reduction is an important component of any successful risk management program.