The best way to protect your business is to identify the most pressing risks and achieve an acceptable risk level for your organization.
This is essentially what Information Risk Management (IRM) is all about. With the right measures and analysis, you can manage your cyber risk from an internal and external perspective to protect your most sensitive data.
What is Information Risk Management?
Information Risk Management (IRM) in cybersecurity is a form of risk mitigation through policies, procedures, and technology that reduces the threat of cyber attacks from vulnerabilities, poor data security, and third-party vendors.
This process is used to create a tailored cybersecurity strategy that incorporates risk-reduction activities and is an ongoing process that needs constant updating to stay ahead of emerging threats.
Ransomware, data breaches, denial of service attacks, supply chain hacks, and other common threats take advantage of vulnerabilities in your company’s IT infrastructure. Your information risk management plan should account for these risks to ensure your organization remains resilient in the face of an evolving cyber threat landscape.
Data breaches have the most negative business impact and often arise from insufficiently protected data.
What are the stages of Information Risk Management?
1) Risk Identification
The very first step is to identify all your important assets. This can include data or systems that have the most significant impact on your business. Once you are aware of the assets that need the most protection, consider what system-level or software vulnerabilities are putting its confidentiality and integrity at risk. Identify the threats and potential causes of the information becoming compromised and analyze the controls required to protect it.
2) Risk Management Strategy
Once a risk has been assessed and analyzed, an organization will need to choose the right course of action, which is dependent on your business. This could be a remediation, mitigation, transference, or risk acceptance strategy.
- Remediation: Implementing a control that completely or nearly fixes the underlying risk and identified vulnerability.
- Mitigation: Reducing the likelihood or impact of the risk, but not fixing it entirely.
This means implementing a firewall that only allows specific systems to communicate with the vulnerable service. - Transference: Transferring the risk to another entity so your organization can recover from the incurred costs of the risk being realized. For example; you purchase insurance that will cover any losses that would be incurred should the vulnerable system be exploited.
- Risk acceptance: This is appropriate in cases where the risk is low and the time and effort it takes to fix the risk costs more than the costs that would be incurred if the risk were to be realized.
3) Communication
Regardless of how a risk is treated, the decision needs to be communicated within the organization. Responsibility and accountability should be clearly defined to ensure the right people are engaged at the right times in the process. This is a critical step in an effective risk management strategy.
4) Repeat
Risk management is an ongoing process. If you choose a treatment plan that requires implementing a control, that control needs to be continuously monitored. Ports being opened, code being changed, and any number of other factors that could cause your control to break down in the months or years following its initial implementation should be considered.
What is the IT Risk Equation?
This is the classic equation for risk that can help you develop your information risk management strategy to prioritize risk reduction efforts and improve your organization’s security position.
Threat x Vulnerability x Consequence
Threat is inherent in information risk management and can manifest within your organization or from third parties including cybercriminals, hackers, and even trusted third parties. Vulnerability is the gaps in your security program that could be exploited. It is extremely important to identify all vulnerabilities in your IT infrastructure to prioritize their management. Consequence represents the harm caused to an organization by a cyberattack or other risk events. You need to consider the value of the information you’re trying to protect — something that is very subjective to each organization.
What are the Best Practices for Managing Information Risk?
Understanding information risk management and the risk equation is the foundation of effective cybersecurity. Once that is done, you need an effective strategy to gain visibility into your entire digital environment to identify digital assets and their associated risks.
To continuously manage information risk, you should:
- Use Security Performance Monitoring: These tools help you continuously look for any emerging vulnerabilities in near real-time, identifying and alerting you to misconfigured software, unpatched systems, and anomalies.
- Measure Security Effectiveness: The continuous measurement of security controls against best practice frameworks provides a data-driven view of how effective your information security efforts are and helps maintain alignment with compliance requirements.
- Manage Third-Party Risks: Third-party vendors and partners are an integral part of modern business operations but also introduce significant risks. Using relevant tools you can mitigate supply chain risk and monitor your vendors’ security positions.
Why do you need Information Risk Management?
Regardless of your organization’s risk tolerance, IT risk management has become a critical component of any business risk strategy.
Governments worldwide have established agencies to improve cybersecurity practices and raise awareness.
Regulatory mandates such as the GDPR now require businesses to integrate reliable information security practices into their operations.
As a result, companies are increasingly appointing Chief Information Security Officers (CISOs) or Virtual CISOs to leverage advanced cybersecurity solutions, drive informed decision-making, and safeguard their digital assets.
Every organization should have comprehensive risk management policy in place that addresses four categories:
- Strategy
- Operations
- Financial reporting and accountability
- Compliance
In conclusion, cybersecurity and information risk management is becoming an increasingly important part of any business and entity.
Organizations need to think through IT risk, perform risk analysis, and have reliable security controls in place.
Agencies like Cybershield IT offer an array of security services, including IT Shield and Cloud security, to help businesses thrive in today’s digital environment.
Connect with our experts to learn more and develop a strategy that suits your business plan.
