HLSSS3

Tolerable vs Acceptable risks What is the difference between tolerable and acceptable risks? As mentioned, acceptable risks are risks that can serve a potential loss that should be not be greater than an organization's financial, economical, and physical goals. This is also known as risk retention, especially when referring to business and corporate fields. Tolerable risks are the measurability of risk that is accepted by society in terms of functionality and management. For example, if law enforcement conduct frequent check points in quiet communities to maintain order (or prevent the disruption of order within an area), is that a tolerable risk? Or is a nuisance to law-abiding citizens?

Although there are acceptable forms are risks, there are also mitigation programs to prevent all hazards. However, nothing is 100 percent effective. Risk mitigation is essentially the protocol for lessening the effects of risks, vulnerabilities, and threats. Herrera (2013) stated there are four steps to effective risk mitigation: risk acceptance, risk avoidance, risk limitation, and risk transference. Risk acceptance simply refers to acknowledging that risk exist and deals with it, even though it does not deter from risk effects. It is a cost-effective strategy used when other methodologies are not conducive financial constraints. When organizations believe there are not a high probability of risk will use this strategy to reduce costs.

Risk avoidance is the reversed concept of risk avoidance and entirely evades risks. It is considered the most expensive forms of risk mitigation protocols (Herrera, 2013). Risk limitation is considered the most commonly used method for companies because it is the least exposure to risks and vulnerabilities. It is the essence of balancing both acceptance and avoidance. Finally, risk transference is the "involvement of of handling risk off to a willing third party" (Herrera, 2013, para. 4). It is common for companies to have external stakeholders to realign programs and bring a broader perspective to the organization's mission and objectives.