Risk Management Policy (SEC-POL-003)

1. Objective

The objective of this policy is to establish a comprehensive risk management framework for [Company Name] that meets SOC 2 requirements while maintaining practical implementation. This policy ensures that information security risks are systematically identified, assessed, and managed to protect company information assets and maintain business operations.

2. Scope

This policy applies to all [Company Name] workforce members, contractors, and third parties. It encompasses all company information assets, systems, and processes, including cloud services and remote work environments.

3. Policy

[Company Name] implements a comprehensive risk management process that meets SOC 2 Common Criteria requirements.

3.1 Risk Management Framework

[Company Name] establishes an effective risk management process.

• Risk management shall follow a cycle of identification, assessment, treatment, and monitoring.

• Risk management activities shall be documented consistently.

• The framework shall be reviewed annually and updated as needed.

• Risk considerations shall be integrated into system changes and vendor decisions.

3.2 Risk Identification

[Company Name] shall identify information security risks through regular assessment and monitoring.

• A comprehensive risk assessment shall be conducted annually and when significant system changes occur.

• Risk identification shall consider common threats including:

  • Cybersecurity threats (malware, phishing, unauthorized access)
  • System failures and outages
  • Human error and insider threats
  • Natural disasters and environmental hazards
  • Third-party and vendor risks

3.3 Risk Assessment

All identified risks shall be analyzed to determine their potential impact and likelihood.

• Impact assessment shall consider financial, operational, and reputational consequences.

• Likelihood assessment shall consider threat capabilities, system vulnerabilities, and existing controls.

• Risk levels shall be categorized as High, Medium, or Low using documented criteria.

3.4 Risk Treatment

[Company Name] shall implement appropriate responses to identified risks based on their level and business impact.

• Risk treatment options include:
  • Accept: Monitor risks within acceptable tolerance levels
  • Avoid: Eliminate risk by discontinuing or modifying activities
  • Mitigate: Implement controls to reduce likelihood or impact
  • Transfer: Share risk through insurance or contracts

• High risks shall be addressed with priority and escalated to management.

• Risk treatment plans shall include specific actions, responsible parties, timelines, and success criteria.

3.5 Risk Monitoring and Review

[Company Name] shall monitor risks and the effectiveness of risk treatments on an ongoing basis.

• A risk register shall be maintained to track identified risks, assessments, treatments, and current status.

• Risk levels shall be reviewed quarterly for high risks and annually for medium and low risks.

• Risk status reports shall be provided to management quarterly.

• The annual risk assessment shall validate identified risks and assess program effectiveness.

3.6 Risk Communication

Risk information shall be communicated effectively to support informed decision-making.

• Risk reports shall be provided to management in a clear, actionable format.

• Critical risks shall be escalated immediately to appropriate management levels.

• Risk communication shall include current risk status, treatment progress, and recommendations for improvement.

3.7 Third-Party Risk Management

Risks from third-party vendors and service providers shall be assessed and managed.

• Security assessments shall be conducted before engaging third parties with access to company systems or data.

• Contracts shall include appropriate security requirements and risk allocation provisions.

• Third-party security performance shall be monitored through regular reviews and assessments.

4. Standards Compliance

This policy is designed to comply with and support the following industry standards and regulations.

Policy Section	Standard/Framework	Control Reference
All	SOC 2 Trust Services Criteria	CC3.1 - Risk Assessment Process
3.2, 3.3	SOC 2 Trust Services Criteria	CC3.2 - Risk Identification and Analysis
3.4	SOC 2 Trust Services Criteria	CC3.3 - Risk Mitigation Activities
3.5	SOC 2 Trust Services Criteria	CC3.4 - Risk Monitoring Activities

5. Definitions

Inherent Risk: The level of risk that exists before any controls or mitigation measures are applied.

Residual Risk: The level of risk that remains after controls and mitigation measures have been implemented.

Risk Assessment: The process of identifying, analyzing, and evaluating information security risks.

Risk Register: A document that records identified risks, their assessments, treatments, and current status.

Risk Treatment: The process of selecting and implementing measures to modify risk.

6. Responsibilities

Role	Responsibility
Executive Leadership	Provide support for risk management activities and approve risk treatment decisions for high-level risks.
IT Manager/Security Officer	Own, implement, and maintain the risk management process. Conduct risk assessments and manage the risk register.
IT Department	Support risk assessment activities and implement technical risk controls.
All Workforce Members	Participate in risk identification and report security concerns or incidents.
Managers	Support risk assessment activities within their areas of responsibility and implement assigned risk treatments.

5. Definitions

Business Impact Assessment (BIA): Analysis to identify and evaluate potential impacts resulting from business disruption.

Inherent Risk: The level of risk that exists before any controls or mitigation measures are applied.

Key Risk Indicators (KRIs): Metrics that provide early warning signals of increasing risk exposure.

Residual Risk: The level of risk remaining after controls and mitigation measures have been applied.

Risk Appetite: The level of risk that an organization is willing to accept in pursuit of its objectives.

Risk Assessment: The systematic process of identifying, analyzing, and evaluating risks.

Risk Register: A document that records identified risks, their analysis, and risk response plans.

Risk Tolerance: The acceptable level of variation around risk appetite.

Threat Intelligence: Information about current and emerging security threats and vulnerabilities.

6. Responsibilities

Role	Responsibility
Executive Leadership	Formally document, approve, and annually review the company’s risk appetite and tolerance levels. Approve risk treatment strategies for high-risk items. Provide resources for risk management activities.
Security Officer	Own and maintain the risk management program. Conduct risk assessments and coordinate risk treatment activities. Report risk status to leadership.
Information Security Committee	Review and approve risk management policies and procedures. Oversee high-risk treatment decisions and resource allocation.
Risk Management Team	Support risk assessment activities, maintain the risk register, and monitor risk treatment effectiveness.
IT Department	Identify technical risks and vulnerabilities. Implement technical risk controls and participate in risk assessments.
Business Unit Managers	Identify business risks within their areas. Participate in risk assessments and implement assigned risk treatments.
Asset/System Owners	Assess risks for their assigned assets or systems. Implement and maintain appropriate risk controls.
All Workforce Members	Report potential risks and security concerns. Comply with risk mitigation controls and procedures.
Audit and Compliance Team	Validate risk assessment processes and control effectiveness. Ensure regulatory compliance requirements are addressed.