What are risk-assessment criteria?

Risk-assessment criteria are essentially the standards used to evaluate the significance of risks within a given context. These criteria help decision-makers quantify, qualify, and prioritize the risks they are facing, enabling them to determine which risks require immediate attention and which may be monitored over time. By establishing clear criteria, leaders can systematically assess risks based on their potential impacts, likelihood of occurrence, and other relevant factors, leading to more informed and effective risk management strategies.

The focus of the assessment is not on increasing, dismissing, or equalizing risks, but rather on understanding and addressing their significance in a structured manner. This understanding supports proactive risk management, ensuring that resources are allocated where they are most needed to mitigate potential issues before they escalate. Thus, using risk-assessment criteria fosters a comprehensive approach to risk management that is essential for effective leadership in any small unit.