The risk assessment process is a systematic approach to identifying, evaluating, and mitigating risks in a given situation or environment. The process typically involves the following eight steps ?:
1. Establish the context: Identify the goals and objectives of the firm and the environment in which it operates. Consider internal and external stakeholders.
2. Identify the hazards: Identify potential hazards that currently exist and those that could appear under certain circumstances.
3. Decide who or what may be affected or harmed: Determine who or what may be affected by the identified hazards.
4. Evaluate the risks: Assess the likelihood and impact of each identified risk.
5. Identify and implement control measures: Develop and implement measures to eliminate or reduce risks.
6. Re-evaluate for remaining risks: Re-evaluate the risks that remain after implementing control measures.
7. Make plans for remaining risks: Develop contingency plans for any remaining risks.
8. Review and repeat: Regularly review and update the risk assessment process.