Principle 2: Risk Management
Purpose: This subsection outlines the second principle of IT Governance, which is to manage risks effectively.
Scope: This principle applies to all IT activities in the organization, including the development, deployment, and management of IT systems and applications.
Applicability: This principle is applicable to all types of organizations, including public and private entities, non-profits, and government agencies.
How does the organization identify and assess IT risks?
Instructions: Explain the process the organization uses to identify and assess IT risks, including any tools or methods used.
Example: The organization may conduct risk assessments using a combination of automated tools and manual processes, and may also use industry-standard frameworks such as ISO 27001 to guide risk identification and assessment.
How are risk management decisions made and communicated?
Instructions: Describe the decision-making process for risk management, including how risk mitigation strategies are selected and how decisions are communicated to relevant stakeholders.
Example: The organization may have a risk management committee or team that evaluates identified risks and selects appropriate risk mitigation strategies. Decisions and risk management plans are then communicated to relevant stakeholders such as IT staff and business unit leaders.
How does the organization prioritize IT risks?
Instructions: Explain how the organization prioritizes IT risks, including any criteria or frameworks used to determine risk severity and likelihood.
Example: The organization may use a risk matrix to prioritize risks based on their potential impact and likelihood, or may use a risk-based approach to prioritize risks based on their importance to business objectives.
How does the organization monitor and review IT risks?
Instructions: Describe how the organization monitors and reviews IT risks, including any metrics or measures used to track risk status and any processes for reporting on risk management activities.
Example: The organization may conduct regular risk assessments and review risk management plans on an ongoing basis. Risk management activities and progress are reported to relevant stakeholders through regular risk management reports.
How are risk mitigation strategies developed and implemented?
Instructions: Explain how the organization develops and implements risk mitigation strategies, including any processes or tools used to support risk mitigation planning and implementation.
Example: The organization may use a risk mitigation framework to guide the development and implementation of risk mitigation strategies, which may include technical controls, policy and procedure changes, or employee training and awareness programs.
How are third-party risks managed?
Instructions: Describe how the organization manages third-party risks, including any due diligence processes used to assess third-party risk and any contractual requirements for third-party risk management.
Example: The organization may conduct due diligence on third-party vendors and contractors to assess their security posture and risk management practices, and may require contractual provisions for third-party risk management, such as security audits and compliance with relevant security standards.
How are risk management practices integrated into IT operations?
Instructions: Explain how the organization integrates risk management practices into IT operations, including any processes or tools used to support risk management as part of ongoing IT operations.
Example: The organization may use an IT service management framework such as ITIL to integrate risk management into IT operations, such as through incident management, problem management, and change management processes.
How are employees trained on risk management policies and procedures?
Instructions: Describe how the organization ensures that employees are aware of and trained on risk management policies and procedures, including any training programs or materials that are provided to employees.
Example: The organization may provide regular risk management training to employees, including IT staff and business unit leaders, to ensure that they are aware of risk management policies and procedures and how to identify and report potential risks.
How are risks tracked and reported to executive management?
Instructions: Explain how risks are tracked and reported to executive management, including any metrics or measures used to track risk status and any processes for reporting on risk management activities.
Example: The organization may use a risk dashboard or other reporting tool to track and report on risk management activities, which may include metrics such as risk exposure, risk likelihood, and risk impact.
How are risk management practices continuously improved?
Instructions: Describe how the organization ensures that risk management practices are continuously improved, including the processes or frameworks used to evaluate and update risk management practices.
Example: The organization may use a risk management maturity model to assess the effectiveness of current risk management practices and identify areas for improvement. This may involve regular assessments and benchmarking against industry standards or best practices, as well as ongoing training and education for risk management stakeholders. The organization may also prioritize continuous improvement initiatives based on risk assessments and other performance data.