What does Return on Investment (ROI) measure related to risk management?

Return on Investment (ROI) in the context of risk management specifically measures the expected gains versus the cost of implementing changes or security controls. When an organization invests in new technologies or practices to mitigate risks, it is essential to assess whether the benefits gained from such investments outweigh the costs incurred. This approach allows decision-makers to justify expenditures on security measures by illustrating how they result in improved security posture, reduced vulnerabilities, or even financial savings over time.

In terms of assessing risk management strategies, ROI helps organizations determine which investments will provide the most significant advantages relative to their costs. This strategic focus enables risk managers to allocate resources more effectively, supporting better informed and financially sound decisions.