What Is Risk Mitigation? Definition, Process & Examples

What Is Risk Mitigation?

Risk mitigation is the process of reducing the likelihood or impact of a risk to an acceptable level, rather than eliminating it entirely (which isn't always possible) or ignoring it. In short, risk mitigation means taking deliberate action to make a risk less severe, less likely, or both.

Risk Mitigation vs. Risk Management

These terms are related but not identical. Risk management is the full process — identifying risks, assessing them, deciding how to respond, and monitoring them over time. Risk mitigation is specifically the response stage: the actions taken once a risk has been identified and assessed.

The Four Risk Mitigation Strategies

Most risk mitigation approaches fall into one of four categories:

1. Avoid — change plans to sidestep the risk entirely, such as not entering a market with unacceptable regulatory risk
2. Reduce — take action to lower the likelihood or impact of the risk, such as adding redundancy to a critical system
3. Transfer — shift the financial consequence of the risk to another party, typically through insurance or contractual terms
4. Accept — consciously decide to bear the risk, usually because the cost of mitigating it exceeds the potential impact

What Mitigating a Risk Looks Like in Practice

Mitigating a risk typically follows a repeatable process: identify the risk, assess its likelihood and potential impact, select a mitigation strategy from the four above, implement it, and then monitor whether it's actually working — since risks and their controls change over time. Organizations often use key risk indicators (KRIs) to track this on an ongoing basis rather than treating mitigation as a one-time exercise.

Risk Mitigation and the Hierarchy of Risk Controls

In safety-critical operations, risk mitigation often follows a structured order of preference similar to the hierarchy of controls used for physical hazards: eliminating the risk source is preferred over merely reducing its likelihood, which is preferred over accepting the risk and relying on response plans alone.

Common Types of Risk Organizations Mitigate

• Operational risk — disruptions to core business processes
• Supply chain risk — dependency on suppliers, logistics, or single-source materials
• Disaster and climate risk — see our guide on disaster risk reduction
• Compliance risk — exposure from failing to meet regulatory requirements
• Financial risk — including liquidity and market exposure

References

• Risk management — Wikipedia