Risk Management Policy (SEC-POL-003)

1. Objective

The objective of this policy is to establish a comprehensive risk management framework for identifying, assessing, treating, and monitoring information security risks across [Company Name]. This policy ensures that security risks are systematically managed to protect the confidentiality, integrity, and availability of information assets, particularly electronic Protected Health Information (ePHI), and to maintain compliance with regulatory requirements while supporting business objectives.

2. Scope

This policy applies to all [Company Name] workforce members, contractors, and third parties. It encompasses all information assets, systems, processes, and facilities owned, operated, or managed by [Company Name], including cloud services, third-party systems, and remote work environments. This policy covers all types of information security risks, including cybersecurity threats, operational risks, compliance risks, and business continuity risks.

3. Policy

[Company Name] shall implement and maintain a systematic risk management process that is integrated into all business activities and decision-making processes.

3.1 Risk Management Framework

[Company Name] shall establish and maintain a formal risk management framework based on industry best practices and regulatory requirements.

  • The risk management process shall follow a continuous cycle of identification, assessment, treatment, monitoring, and review.

  • Risk management activities shall be documented, consistent, and repeatable across the organization.

  • The framework shall be reviewed annually and updated as needed to reflect changes in the business environment, threat landscape, or regulatory requirements.

  • Risk management shall be integrated into strategic planning, project management, system development, and vendor management processes.

3.2 Risk Identification

[Company Name] shall proactively identify information security risks through multiple sources and methods.

  • Comprehensive risk assessments shall be conducted at least annually and whenever significant changes occur to systems, processes, or the business environment.

  • Threat intelligence sources shall be monitored to identify emerging risks and attack vectors relevant to the healthcare industry.

  • Vulnerability scanning shall be conducted at least quarterly for external-facing systems and annually for internal systems. External penetration testing shall be conducted at least annually.

  • Business process reviews shall be conducted to identify operational and procedural risks.

  • Risk identification shall consider internal and external threats, including but not limited to:

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

3.3 Risk Assessment and Analysis

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

  • Risk assessment shall consider both inherent risk (before controls) and residual risk (after controls are applied).

  • Impact assessment shall evaluate potential consequences across multiple dimensions:
    • Financial impact (direct costs, regulatory fines, business disruption)
    • Operational impact (service disruption, productivity loss)
    • Reputational impact (customer trust, market confidence)
    • Regulatory impact (compliance violations, sanctions)
    • Patient safety and privacy implications
  • Likelihood assessment shall consider:
    • Threat actor capabilities and motivations
    • Asset vulnerabilities and exposure
    • Effectiveness of existing controls
    • Historical incident data and industry trends
  • Risk levels shall be determined using a standardized risk matrix. The criteria for impact, likelihood, and the resulting risk levels (High, Medium, Low) shall be formally documented and approved by the Information Security Committee.

3.4 Risk Treatment

[Company Name] shall implement appropriate risk treatment strategies based on risk levels and business priorities.

  • Risk treatment options include:
    • Accept: Acknowledge and monitor risks that fall within acceptable tolerance levels
    • Avoid: Eliminate the risk by discontinuing or modifying activities
    • Mitigate: Implement controls to reduce likelihood or impact
    • Transfer: Share or transfer risk through insurance, contracts, or outsourcing

  • High-risk items shall be addressed with priority and escalated to executive leadership for treatment decisions.

  • Risk treatment plans shall include:
    • Specific actions and controls to be implemented
    • Responsible parties and timelines
    • Resource requirements and budget allocations
    • Success criteria and monitoring measures
  • The effectiveness of risk treatments shall be monitored and measured regularly.

3.5 Risk Monitoring and Review

[Company Name] shall continuously monitor the risk environment and the effectiveness of risk treatments.

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

  • Risk levels shall be reviewed quarterly or when significant changes occur.

  • Key risk indicators (KRIs) shall be established and monitored to provide early warning of increasing risk levels.

  • Regular reports on risk status and trends shall be provided to executive leadership and the Information Security Committee.

  • Annual risk assessment reviews shall validate the continued relevance of identified risks and assess the effectiveness of the overall risk management program.

3.6 Risk Communication and Reporting

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

  • Risk reporting shall be tailored to the audience, with executive summaries for leadership and detailed technical reports for operational teams.

  • Critical risks and significant risk changes shall be escalated immediately to appropriate management levels.

  • Risk communication shall include:

    • Current risk landscape and trends
    • Status of risk treatment activities
    • Emerging threats and vulnerabilities
    • Recommendations for risk mitigation
    • Compliance and regulatory implications

3.7 Third-Party Risk Management

Risks associated with third-party vendors, business associates, and service providers shall be assessed and managed as part of the overall risk management program.

  • Due diligence assessments shall be conducted before engaging third parties that will access, process, or store company information.

  • Contractual agreements shall include specific security requirements and risk allocation provisions.

  • Ongoing monitoring of third-party security posture shall be conducted through security questionnaires, audits, and performance reviews.

  • Third-party incidents and security events shall be tracked and incorporated into risk assessments.

3.8 Business Continuity and Operational Risk

Risk management shall include consideration of business continuity and operational resilience requirements.

  • Business impact assessments (BIAs) shall be conducted to identify critical business functions and acceptable downtime limits.

  • Single points of failure shall be identified and addressed through redundancy or alternative arrangements.

  • Disaster recovery and business continuity plans shall be developed based on risk assessment results.

  • Regular testing of continuity plans shall be conducted to validate their effectiveness.

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 HIPAA Security Rule 45 CFR § 164.308(a)(1)(ii)(A) - Conduct risk assessments
All HIPAA Security Rule 45 CFR § 164.308(a)(1)(ii)(B) - Implement security measures
3.3 HIPAA Security Rule 45 CFR § 164.308(a)(1)(ii)(A) - Periodic risk assessment
3.7 HIPAA Security Rule 45 CFR § 164.314(a)(1) - Business Associate contracts
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
3.8 SOC 2 Trust Services Criteria A1.1 - Availability and Business Continuity
All ISO/IEC 27001:2022 A.5.2 - Information security risk management

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.