Enterprise Risk Management Glossary

The level of risk that is tolerable for an organization after risk mitigation efforts, considering cost-benefit analysis.

The total amount of risk that an organization faces from all sources combined, often used to evaluate capital adequacy.

The use of data analytics and business intelligence to assess, monitor, and respond to risk in real-time.

The risk that auditors may issue an incorrect opinion on financial statements due to errors or fraud.

The level of inherent risk present in an organization before any risk mitigation or control actions are applied.

A documented strategy for how a business will continue operating during an unplanned disruption in service.

A process that identifies critical business functions and evaluates the potential impact of disruptions.

The risk of legal or regulatory sanctions, material financial loss, or reputational damage an organization may suffer due to non-compliance.

The set of standards, processes, and structures that provide the foundation for carrying out internal controls across the organization.

The methods used by an organization to respond to an unexpected and significant negative event.

Metrics that signal the presence or likelihood of a key risk materializing.

The overall management of data availability, usability, integrity, and security within an organization.

The practice of basing business decisions on the analysis of data rather than intuition or observation alone.

The potential business losses associated with system outages or service interruptions.

Newly developing or evolving risks that are difficult to quantify but may have a significant impact on the organization.

A holistic and structured approach to identifying, assessing, managing, and monitoring risks across the entire organization to create, protect, and enhance value.

The possibility of a specific event causing a significant disruption to operations, finances, or reputation.

The potential for losses due to market fluctuations, credit defaults, liquidity shortages, or other financial disruptions.

The vulnerability of a business to acts of deception intended to result in financial or personal gain.

An integrated strategy for managing an organization’s overall governance, enterprise risk management, and compliance with regulations.

A method used to assess the difference between current risk management practices and best practices or required standards.

Risks associated with accidents, natural disasters, or other physical threats that cause loss or harm.

A visual representation of risks plotted according to likelihood and impact, often used to prioritize risk response.

The process of assessing the effects of risk events on business operations, performance, and objectives.

The level of risk that exists before any controls or mitigations are applied.

A type of risk that can be covered by insurance policies, often involving predictable and quantifiable events.

Processes designed to ensure the integrity of financial and accounting information, promote accountability, and prevent fraud.

A measurable value that indicates how effectively a company is achieving key business objectives.

A measurable value that signals an increasing likelihood of a risk event or condition occurring.

The probability or chance that a risk event will occur.

An occurrence that results in a loss or damage to the organization, financial or otherwise.

Actions taken to reduce the likelihood or impact of a risk.

The potential for inaccuracy in the output of risk models due to incorrect assumptions, inputs, or algorithms.

Risk arising from inadequate or failed internal processes, people, systems, or external events.

The risk of missing out on potential business opportunities due to delayed or misinformed decisions.

The O.A.S.I.S. Enterprise Risk Management System (Observation, Analysis, Strategy, Implementation, Scale/Sell) is a comprehensive, data-driven framework designed to identify, assess, and mitigate organizational risks at every level. Through its five-phase methodology, O.A.S.I.S. integrates real-time data, strategic planning, and operational execution to expose vulnerabilities, enhance resilience, and align risk management with business objectives.

A statistical function that describes all the possible values and likelihoods a random variable can take.

A control designed to stop errors or irregularities before they occur.

The most significant risks that could threaten the achievement of strategic objectives.

A numerical approach to estimating the probability and impact of risk, often involving simulations or modeling.

A descriptive approach to identifying and evaluating risks based on subjective judgments or expert opinions.

The remaining risk after risk treatment or mitigation has been applied.

The amount and type of risk an organization is willing to take in pursuit of its objectives.

The process of identifying, analyzing, and evaluating risks.

A strategy to eliminate risk entirely by discontinuing the activities that generate it.

The maximum level of risk that an organization can assume given its resources, capabilities, and obligations.

The extent to which a business is vulnerable to loss or damage from risk events.

The structured approach an organization follows to manage risks in alignment with its strategy and objectives.

The specific actions taken to reduce or control risk to an acceptable level.

The individual or team responsible for managing a particular risk and ensuring it is properly addressed.

A technique that explores different future states by evaluating the impact of various potential risk events.

Risks that affect an organization’s ability to achieve its strategic goals, such as market shifts or regulatory changes.

The risk of collapse in an entire industry or economy due to the failure of a single entity or group of entities.

The risk posed to an organization by its vendors, suppliers, contractors, or other external partners.

A pre-defined level of risk or indicator that, when crossed, triggers action or escalation.

The degree of variation in outcomes that an organization is willing to accept in pursuit of its objectives.

A statistical measure used to estimate the potential loss in value of an asset or portfolio over a defined period for a given confidence interval.

The process of identifying, assessing, and controlling the risks posed by third-party vendors and service providers.

Weaknesses or gaps in a system, process, or control that could be exploited by threats or lead to loss.

A policy that encourages employees or stakeholders to report unethical or illegal activities without fear of retaliation.

An alternative solution developed to address a risk or issue that cannot be resolved immediately.