Cyber risk management is a proactive cybersecurity approach focused on predicting and mitigating risks across the entire attack surface.
Cyber risk management is a way of improving an organization’s cybersecurity situational awareness—identifying, prioritizing, and mitigating threats. Attack surface management (ASM) is an essential element of cyber risk management.
Cyber risk management can be broken down into four distinct parts:
- Risk Identification: Understanding your organization’s IT infrastructure, knowing where weaknesses are, and identifying threats.
- Risk Assessment: Evaluating the likelihood of your organization's vulnerabilities being exploited and evaluating the impact that exploitation would have.
- Risk Mitigation: Implementing measures, such as technical, administrative, and physical controls will help to reduce the impact of threats. Beyond this, educating your organization on cybersecurity best practices and establishing guidelines for security operations and incident response will encourage more resilience.
- Risk Monitoring: Continuously observing and reviewing the risk landscape through regular assessments, monitoring controls and incident response to identify new threats and assess the effectiveness of mitigation measures
Cyber risk management covers the same three phases as attack surface management: discovery, assessment, and mitigation. The assessment phase includes risk scoring so that the organization can benchmark and monitor its risk profile over time.
What are cyber risks?
The National Institute of Standards and Technology defines cyber risk in two distinct but related ways:
- “The risk of depending on cyber resources (i.e., the risk of depending on a system or system elements that exist in or intermittently have a presence in cyberspace).”
- “Risk of financial loss, operational disruption, or damage, from the failure of the digital technologies employed for informational and/or operational functions introduced to a manufacturing system via electronic means from the unauthorized access, use, disclosure, disruption, modification, or destruction of the manufacturing system.”
Both definitions apply to the need for organizations to adopt and implement a proactive cyber risk management framework.
Why does cyber risk management matter?
The expanding attack surface means that organizations face more cyber risks than ever before. The scale and complexity of the threat environment have kept many security teams in reactive mode for years, lacking the capacity, visibility, and insight they need to get ahead of threats and prevent breaches from happening.
As part of an overall approach to managing the attack surface, cyber risk management gives security personnel a comprehensive view of the risks their organizations face. A good cyber risk management framework also helps determine which risks are most relevant, supporting ‘risk-informed decision making’ to reduce overall threat exposure.
With the insights they glean, security teams can strengthen defenses, minimize vulnerabilities, and inform their organizations’ overall risk management and strategic planning processes.
What are the legal or regulatory implications of cyber risks?
Organizations that fail to manage cyber risks effectively could face fines or legal actions—even including criminal proceedings and jail sentences. Many laws and regulations include requirements for reporting data breaches in a timely way, and for ensuring the privacy and security of personal and sensitive data. The EU’s General Data Protection Regulation (GDPR) and the U.S. Health Insurance Portability and Accountability Act (HIPAA) are some of the most prominent and familiar frameworks.
Beyond incurring penalties, organizations that mismanage cyber risk and suffer a breach or loss can also experience a loss of trust and reputational damage among customers, partners, and employees.
Given the potential severity of the consequences, many corporate boards are taking an active interest in company cyber risk management. In fact, many directors are being held accountable for cybersecurity performance.
How does cyber risk management work?
Cyber risk management is about adopting a strategic approach to cybersecurity that is tailored to the needs of the organization and promotes a strong compliance posture. It has six main components or areas of activity, all of which are required in combination. They are:
- Risk-based asset identification and classification: Gaining a complete view of the entire attack surface so that all assets and data are known and can be secured against cyberattack.
- Risk-based vulnerability analysis: Scanning assets and testing for vulnerabilities on a regular, ongoing basis, with a focus on the vulnerabilities that present the greatest risks.
- Risk-based threat assessment: Analyzing risks in awareness of the evolving threat environment and determining which threats are potentially most dangerous for the organization’s critical assets.
- Risk prioritization: Understanding which risks are most urgent and potentially severe to inform decisions and direct cybersecurity investments.
- Zero trust risk-based controls: Adopting zero-trust frameworks and architectures to reduce the overall attack surface and limit risk.
- Continuous monitoring and improvement: Centralizing visibility across the attack surface to enable continuous risk management and adaptation to the evolving threat landscape.
What is a cyber risk management framework?
A cyber risk management framework gives organizations a structured way of proactively identifying, assessing, and mitigating cybersecurity risks. It involves policies and procedures that require an enterprise cybersecurity platform.
The U.S. National Institute of Standards and Technology (NIST) has publicly shared its cybersecurity framework to serve as a model for other organizations. The NIST framework is focused on outcomes—helping organizations determine what they specifically want to achieve by managing cyber risk—rather than dictating how cyber risk management should be done.
Ultimately, the NIST framework enables organizations to understand and assess their current security status, prioritize risks and actions to take, and establish a shared or common way of communicating cybersecurity activities, both internally and externally.
How can we implement cyber risk management?
Public-sector bodies in many countries have outlined stepped approaches to implementing cyber risk management frameworks. The UK National Cyber Security Centre, for example, proposes an eight-step method:
- Establish organizational context
- Identify decision makers, governance processes, and constraints
- Define cyber security risk challenges
- Select an approach
- Understand risks and how to manage them
- Communicate and consult
- Implement and assure
- Monitor and review
The UK model underscores the importance of understanding not only the attack surface and threat landscape but also the unique context and conditions of the organization itself. That includes the focus and values of the business, key stakeholders, and specific risks. For example, a company in the financial services space will have anti-fraud and anti-money laundering requirements to meet that a manufacturer likely won’t. But a manufacturer could instead need to manage cyber risks around its supply chain.
Creating a common cyber risk management framework and having a single pane of glass view of the risk environment (the attack surface) are crucial to implementing a cyber risk management framework. Both depend on a couple of key capabilities. One, as mentioned above, is adopting a zero-trust approach to cybersecurity. The other is deploying extended detection and response (XDR) technology to gather and analyze attack surface data.
Adopting a cybersecurity platform can support the shift to zero trust. A complete platform will also include security operations such as XDR—providing the essential prerequisites for cyber risk management.
How does attack surface management fit with cyber risk management?
Attack surface management (ASM) is a key aspect of overall cyber risk management. As the name suggests, attack surface management is concerned with the attack surface specifically: the total set of vulnerabilities, access points, and attack vectors that can be exploited to gain unauthorized access to an organization’s systems and data.
ASM focuses on discovering, assessing, and mitigating risks related to the attack surface, ideally in a continuous and ongoing process.
Discovery is about defining the attack surface and all the assets that make it up. This requires an attack surface management solution that can scan the IT environment to identify all known and unknown devices, software, systems, and access points. Discovery also aims to identify shadow IT apps, connected third-party technologies, and technologies that haven’t been part of previous inventories.
Assessment is the process of determining the urgency and potential severity of risks associated with all the assets discovered. This involves risk quantification and risk scoring —ways of prioritizing and ranking vulnerabilities and risks in an objective way.
Mitigation is about taking action to deal with vulnerabilities that are discovered. That might mean running software updates or installing patches, setting up security controls and hardware, or implementing protective frameworks such as zero trust. It could also include getting rid of old systems and software.
Where can I get help with cyber risk management?
Trend Micro Research created the Cyber Risk Index (CRI) with the Ponemon Institute to investigate cyber risks and identify key areas for improving cybersecurity. Refreshed regularly, the CRI measures the gap between an organization's current security posture and its likelihood of being attacked. Use the CRI calculator here to determine your organization’s risk score.
Trend Vision One™ offers a Cyber Risk and Exposure Management (CREM) solution that ensures organizations can go beyond just ASM to reduce their cyber risk footprint. CREM takes a revolutionary approach by combining key capabilities—like External Attack Surface Management (EASM), Cyber Asset Attack Surface Management (CAASM), Vulnerability Management, and Security Posture Management—across cloud, data, identity, APIs, AI, compliance, and SaaS applications into one powerful, easy-to-use solution. It’s not just about managing threats—it’s about building true risk resilience.
Learn more about how Cyber Risk Exposure Management can help you with identifying, prioritizing, and mitigating threats.