The potential gain consists in taking a risk. Every business face threats to its earnings and capital. Risk management involves identifying those threats and making a preemptive tactical strike on the danger involved and informative decisions based on the company’s state.

Risks are part of the business. No company is safe from the uncertain future but managing what risks you take is how we grow and learn, lest we grow old and stagnate in our ways.

Risks are commonly associated with investments and purchasing but are not necessarily financial. Legal liabilities and acts of God, like natural disasters, are risks as well.