What are key risk indicators (KRIs)?

Key Risk Indicators (KRIs) are specific metrics that are established to provide an early warning or signal regarding potential increases in risk levels within an organization. They serve as benchmarks to monitor risk and can help identify issues before they escalate into significant problems. This proactive approach enables organizations to mitigate risks effectively by implementing necessary controls or risk management strategies.

KRIs can apply to various aspects of an organization, including financial performance, compliance, operational risks, and security measures. By analyzing trends in these indicators, organizations can make informed decisions and enhance their risk management processes. The ability of KRIs to provide early warnings is crucial for timely intervention and maintaining organizational resilience.

While employee performance metrics, assessments of physical security measures, and quantification of asset value depreciation are important in their contexts, they do not align with the primary purpose of KRIs, which is to indicate rising risks within an organization. Hence, the focus of KRIs on early detection of risk levels is what makes the selected answer accurate.