Key risk indicator

A key risk indicator (KRI) is a measure used in management to indicate how risky an activity is. Key risk indicators are metrics used by organizations to provide an early signal of increasing risk exposures in various areas of the enterprise. It differs from a key performance indicator (KPI) in that the latter is meant as a measure of how well something is being done while the former is an indicator of the possibility of future adverse impact. KRI give an early warning to identify potential event that may harm continuity of the activity/project.

KRIs are a mainstay of operational risk analysis.

According to OECD

According to Risk IT framework by ISACA, key risk indicators are metrics capable of showing that the organization is subject or has a high probability of being subject to a risk that exceed the defined risk appetite.

Organizations have different sizes and environment. So every enterprise should choose its own KRI, taking into account the following steps:

The constant measure of KRI can bring the following benefits to the organization:

This page was last edited on 3 February 2018, at 01:18.
Reference: under CC BY-SA license.

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