Security Risk Management Steps

Posted in Risk Management, Fraud Risk Management on April 15, 2024
Security Risk Management Steps

The security risk management steps involved in performing information security risk management activities is important. Risk management is an ongoing process that needs to be performed appropriately and logically. The information security risk management process requires identifying risk sources to assess and evaluate relevant information or data security risks. 

Security Risk Management Steps

The following steps are involved in performing information security risk management. These steps are followed in sequence by the organization’s information security risk management team:

  1. Defining information security risk sources 
  2. Information security risk identification process
  3. Information security risk assessment process
  4. Mapping of information security risks and controls
  5. Evaluation of the operating effectiveness of information security controls 
Security Risk Management Steps

Defining Information Security Risk Sources 

Applicable cybersecurity or data protection-related laws and regulations contain provisions or guidelines an organization must comply with by implementing appropriate information security processes and controls. Those provisions or guidelines risk regulatory non-compliance if not addressed by the organization. Therefore, information security risks can also be identified from the applicable laws and regulations for risk assessment and management purposes. 

Information Security Risk Identification Process

Information and data owners and custodians are the people who possess the actual knowledge base of the customers, operations, and other business activities. 

Knowledge is also gained through analyzing actual information security incidents that occurred and were reported within the organization. The operational loss database of the organization includes information security incidents and data breach incidents that occurred at different locations and departments, having financial and reputational risk impacts. 

Information Security Risk Assessment Process

Once the information security risks are identified from different risk sources, the likelihood of the occurrence of information security is assessed. Assessing the likelihood is subjective because relevant data or information is unavailable to the organization that accurately predicts the likelihood of a particular information security risk. 

Mapping of Information Security Risks and Controls

Preventive controls are built and implemented to prevent information security risk incidents. In contrast, detective controls detect the occurrence of information security incidents or data breaches.

Management also identifies the general controls and differentiates these controls from the process-specific controls, which are built into the processes to prevent the occurrence of fraud. General controls are designed and implemented to support the organization, such as establishing IT processes to ensure that all departments use technology to perform their duties. 

Security Risk Management Steps

Evaluation of the Operating Effectiveness of Information Security Controls

Internal information security controls’ operating effectiveness and efficiency are significant parameters in assessing the risk of data losses in any organization. One may have a view of the organization by understanding its internal controls and its operating effectiveness.

It is not only necessary to design and implement the internal controls, but the main point is to ensure the operating efficiencies and effectiveness of the controls. Controls’ effectiveness means reducing the chances of fraud or identifying many information and data-related fraud risks with the help of implemented controls.

Final Thoughts

The steps involved in performing information security risk management are defining information security risk sources, information security risk identification process, information security risk assessment process, mapping of information security risks and controls and evaluation of the operating effectiveness of information security controls.