A legal risk is where the event or consequences are legal in nature. Legal risk analysis requires expert judgement from professionals trained in the law. This does not mean that only lawyers can perform legal risk analysis, nor that lawyers are sufficient for legal risk analysis.
Senior executive and corporate lawyer for 20+ years. Featured speaker on risk management and compliance around the world. JD from Cornell Law School and a BA from the University of Washington.
Risk is the effect of uncertainty on objectives. This definition of risk is deceptively simple.
Risk is a way to understand the relationship between our uncertainty and our objectives. Risk is “the effect of uncertainty on our objectives.”
Risk treatment simply means the steps we take to manage some risk. At the end of the risk assessment process, evaluation, one of the actions we can take is to treat the risk. That is do something about the risk.
Analysis of legal risk during the assessment process gives us a better understanding of the likelihood and consequences of an event. The question now is what to do about the risk.