Risk Control & Risk Management: What’s the Difference?
Risk control and risk management are both important for dealing with risk in any organization. Knowing the difference between them helps with identifying vulnerabilities, monitoring risks, and making informed decisions about managing risk effectively.
In this article, we’ll explore the distinctions between risk control and risk management and provide five tactics for mastering organizational risk management. We’ll also discuss the three specific risk categories you should consider when developing risk management strategies.
Risk Control vs. Risk Management: How Do They Differ?
Risk control refers to mitigating or reducing the risks of a particular activity or situation. In contrast, risk management is a broader term for the full effort to identify, assess, and treat various types of risks across an organization or project.
Effective risk control involves implementing measures to reduce the probability or impact of potential risks. This may include strategies such as implementing safety procedures, creating backup systems, or taking preventative measures to reduce the likelihood of bad outcomes.
More specifically, risk control focuses on minimizing the effect of identified risks on a specific activity or project. This method uses the results from risk assessments to identify possible business risks in operations.
Risk management takes a holistic approach to analyzing all potential risks, including new risks emerging from technological advancements and cybersecurity threats. In other words, risk control is one part of risk management, but only one part. Risk management is much larger and more far-reaching.
5 Tactics for Mastering Organizational Risk Management
An effective risk management program is vital for organizations to assure business continuity during unpredictable events. This requires minimizing risk factors to maintain long-term operational success.
1. Risk Identification
In this step, organizations identify all the potential risks that could harm business objectives, including security risk, compliance risk, financial risk, operational risk, supply chain risk, and strategic risk. The risks are categorized and a risk register is created, which contains details about each risk’s nature, sources, and potential impact.
2. Risk Prioritization
To prioritize risks logically, organizations must first conduct a thorough risk analysis, including worst-case scenario analysis, to determine the level of risk of each identified risk. Then the risks are arranged based on likelihood of occurring and potential impact, taking into account the organization’s risk appetite. The prioritized list can be used to focus resources and efforts on the most critical risks first, while staying within the risk appetite.
3. Risk Response
The prioritized list risks can be used to develop a response plan that outlines how to address each risk. It may include risk reduction, risk avoidance, risk transfer, or retention of the risk. For example, an organization may develop internal controls to mitigate a financial risk or decide to transfer the risk to an insurance company by taking out an insurance policy.
4. Risk Mitigation
Risk mitigation can reduce the likelihood or impact of identified risks. This may include developing contingency plans, establishing backup systems, or implementing safeguards to prevent potential risks from occurring. Risk mitigation measures should be chosen based on the level of risk and the potential impact of the risk on the organization’s stakeholders.
5. Risk Monitoring
The final steps in the risk management process are continuous monitoring and regular review of the effectiveness of the risk management plan. This helps organizations identify any new risks that may arise and evaluate the effectiveness of the risk mitigation measures that have been implemented. Regular risk monitoring allows organizations to update their risk management plan so it stays aligned with business objectives and continues to manage risk effectively.
What Are the Three Fundamental Risk Categories?
Understanding the three primary risk categories is necessary for identifying, assessing, and mitigating organizational risks effectively.
1. Preventable Risks
Preventable risks are risks that organizations can mitigate or eliminate by implementing effective internal controls. Think of it as a proactive approach to risk management. Preventable risks include operations-related risks, such as process failures, system breakdowns, data breach, or human error. Active prevention is a practical way to mitigate and eliminate preventable risks. It involves implementing robust internal controls, policies, and procedures to identify, assess, and reduce potential risks. This requires a comprehensive understanding of an organization’s risks and a proactive mindset toward risk management.
2. Strategy Risks
Strategic risks are associated with achieving strategic business objectives, such as entering new markets, launching new products or services, or coping with new regulations. These risks can arise from factors such as economic downturns, disruptive technologies, or shifts in consumer behavior; they are often beyond a company’s control. Strategic risks can be difficult to foresee and require organizations to be adaptable to changing market conditions. To manage strategic risks, organizations need to conduct regular risk assessments, develop contingency plans, and ensure that their risk management strategy is aligned with their overall business objectives.
3. External Risks
These risks are outside the organization’s control and are associated with political instability, natural disasters, or cyberattacks. External threats can significantly impact an organization’s operations, financial stability, and reputation. Since these risks can’t be prevented, companies should try to identify them and then mitigate the potential damage. That might include using a robust risk management framework to identify and evaluate external risks and then take measures to minimize the impact on the organization.
Best Practices for Risk Management
Foster a Risk-Aware Culture at Every Level
Creating a risk culture means embedding it in daily behavior. Policies don’t mean much if teams don’t consider risk when making decisions. This starts with comprehensive training that goes beyond compliance checklists and encourages people to flag issues early, even if they seem small. It means having leadership model transparency around risks and openly discussing trade-offs in strategy meetings.
When people know how their actions affect risk exposure, they stop thinking of it as someone else’s problem.
Prioritize Stakeholder Communication and Transparency
Open communication is one of the most underrated risk management tools. If stakeholders—including board members, department heads, compliance leads, and even vendors—are working off old assumptions, their decisions may increase exposure without them realizing it. Regular updates, whether via interactive dashboards or quarterly risk summaries, give people the context they need to act responsibly.
Explaining the “why” behind decisions also helps: people are more likely to align with mitigation plans if they understand the rationale. For audit teams, this level of clarity also helps document intent and process during reviews.
Best Practices for Risk Control
Practice Real-Time Risk Control and Adaptive Response
Annual reviews and static controls are no longer sufficient, especially when dealing with fast-moving risks like cybersecurity threats, third-party exposures, or operational disruptions. Risk teams need to be able to act quickly and update controls as new potential threats emerge or conditions shift. This might mean tightening system alerts, pausing risky operations, or deploying a fallback plan.
Real-time control also depends on having clear lines of communication and decision-making authority, so teams don’t hesitate during critical moments. This ensures there’s no delay when action is needed.
Accept Risk Only When It’s a Calculated Bet
Risk acceptance is often misunderstood. It’s not a sign of weakness or inaction—it’s a strategic choice made when the cost of mitigation outweighs the potential impact. However, it must be documented, deliberate, and continuously evaluated. Too often, risks are “accepted” because no one took responsibility or followed up. Avoid this by keeping a centralized log of accepted risks, ensuring executive sign-off, and setting a trigger for reassessment. This keeps accepted risks from turning into blind spots and shows auditors that choices are based on business logic, not negligence.
Implement and Stress-Test Critical Risk Controls
A plan is not effective if it can’t withstand pressure. Stress-testing risk controls exposes what doesn’t work before it matters. Run simulations that test systems, teams, and communications under real-world conditions.
For example, disaster recovery strategies should include regular backups and failover tests, while incident response plans should be rehearsed across departments. Safety protocols should be revisited after near misses or regulatory updates. These tests reveal gaps in execution, timing, or coverage that might not be visible on paper.
Simplify the Risk Management Process with ZenGRC
ZenGRC is an invaluable tool that enhances your enterprise risk management strategy. It gives you complete visibility into potential risks and their impact on business operations. The platform’s holistic approach to risk management empowers you to make informed decisions, allocate resources more effectively, and safeguard digital assets.
Schedule a demo today to see how ZenGRC can help you overcome risk management challenges.