What are Alternatives to Reduce Risk: Compensating Controls


I know that businesses face an ever-increasing threat of cyber attacks. These attacks can put your company’s financial well-being and reputation at risk. So, what can you do to protect your business from these attacks?

One potential solution is compensating controls. Compensating controls are alternative measures that businesses can take to reduce risk when primary controls are not available or feasible. These controls can be used to help mitigate the risk of cyber attacks and keep your company safe.

But how do compensating controls work? And are they a viable option for businesses looking to beef up their cybersecurity? In this article, we’re going to explore alternative ways to reduce risk with compensating controls and why they should be a part of any company’s cybersecurity strategy.

Ready to learn more? Let’s dive in and discover the power of compensating controls.

What are compensating controls to mitigate risk?

Compensating controls are temporary measures that are put in place when existing security measures are unable to meet certain requirements for compliance. These controls are implemented to mitigate the risk of a breach or attack until a permanent, mitigating control can be established. Here are some examples of compensating controls:

  • Increased monitoring: Additional monitoring can be put in place to detect any suspicious activity that may be missed by existing controls. This can include reviewing logs more frequently, using intrusion detection systems, or increasing the frequency of vulnerability scans.
  • Manual processes: In situations where automated controls are not sufficient, manual processes can be implemented as a compensating control. For example, email filters can be set up to automatically flag certain suspicious emails, but if a high-risk email gets through, a manual review process can be used to identify and address the threat.
  • Access restrictions: If a system or application does not have sufficient controls in place to restrict access, compensating controls can be implemented to restrict access to sensitive data or critical systems. This can include limiting the number of accounts with access, implementing multi-factor authentication, or reviewing access logs more frequently.
  • Additional training: Compensating controls can also include additional training for employees to help them identify and respond to security threats. This can include security awareness training, phishing simulations, or incident response training.

    Overall, compensating controls are a critical part of a comprehensive risk management strategy. By implementing temporary controls to mitigate risk, organizations can ensure that they are meeting compliance requirements while also working towards implementing more permanent, mitigating controls.

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    1. Start with a risk assessment to identify areas of vulnerability: Compensating controls are only effective if they are addressing the specific areas of risk that are present. Hence, you must conduct a thorough risk assessment to target areas that require additional measures.

    2. Identify compensating controls for each area of vulnerability: Once you have identified the areas of risk, you should determine the compensating controls that will help reduce that risk. These controls should be specific to each area of concern, and they should be effective in reducing vulnerabilities.

    3. Ensure your controls are proportional to the level of risk: The compensating controls you implement should be strong enough to mitigate the identified risks, but they should not be overly burdensome. They should align with the level of risk. If the controls are overly stringent, they may hinder employee productivity or even discourage the use of security measures.

    4. Regularly evaluate the effectiveness of your controls: Compensating controls should be regularly assessed to ensure their continued effectiveness. Controls that fail to reduce risks should be replaced with better ones that are more effective.

    5. Consider using multiple compensating controls: Implementing a blend of compensating controls can be an effective approach to mitigating risks. Multiple compensating controls provide layers of security so that if one control fails, another control can take its place to reduce the chance of a security breach.

    Types of Risk Mitigation Controls

    Risk mitigation controls are essential in information security to reduce potential threats and vulnerabilities. There are two types of risk mitigation controls: mitigating controls and compensating controls. The former aims to decrease the likelihood of risk happening by modifying the system or process or eliminating the source of the threat. Mitigating controls are designed to be permanent and address the root cause of the risk. Some examples of mitigating controls include firewalls, encryption, and access control procedures.

    Understanding Compensating Controls

    On the other hand, compensating controls are temporary measures that are put in place when existing security measures are insufficient to meet certain requirements for compliance. Compensating controls aim to reduce the risk severity, as they don’t address the root cause of the risk. Instead, compensating controls provide alternative measures to address the vulnerability resulting from inadequate or failed security controls. For example, compensating controls might be employed when a particular compliance regulation requires a specific security measure, but the organization is not able to implement that measure due to technological, financial, or other constraints.

    Compensating Controls vs. Mitigating Controls

    The primary difference between mitigating controls and compensating controls is that the former is designed to be permanent, while the latter is only temporary. Mitigating controls aim to reduce the likelihood of risk happening by addressing the root cause of the risk. In contrast, compensating controls aim to reduce risk severity by providing alternate measures to address vulnerabilities resulting from inadequate or failed security controls. Mitigating controls are considered as a primary line of defense in an information security program. Compensating controls are used in situations where the organization is unable to fulfill specific security requirements.

    Characteristics of Compensating Controls

    Compensating controls have some characteristics that set them apart from mitigating controls. Some of the characteristics of compensating controls are:

    • Temporal: Compensating controls are temporary measures designed to fulfill specific security requirements or obligations.
    • Limited Scope: Compensating controls are narrow in scope. They address a particular vulnerability resulting from inadequate or failed security measures.
    • Indirect Effectiveness: Compensating controls may reduce the risk severity to some extent, but they do not address the root cause of the problem directly.
    • Increased Complexity: Compensating controls may add extra complexity to the security program, which can make it more challenging to manage and maintain.

    Designing Effective Compensating Controls

    Designing effective compensating controls can be challenging, especially if the organization lacks the expertise or resources to identify and mitigate risks. To design effective compensating controls, the organization should follow these steps:

    • Identify Risks: The first step is to identify the risks that require compensating controls. Risk assessment and analysis should be conducted to identify areas of weakness in the existing security measures.
    • Determine Requirements: The organization should determine the specific security requirements that need to be met to comply with regulations or standards.
    • Develop Controls: Once the risks and requirements have been identified, compensating controls should be developed to address the specific vulnerabilities. The compensating controls should be designed to be effective, efficient, and compliant with the regulations or standards.
    • Test and Monitor: The effectiveness of the compensating controls should be tested and monitored regularly to ensure that they are working as intended.

    Implementing Compensating Controls in Information Security

    Compensating controls can be implemented in various ways to address specific vulnerabilities. Some examples of compensating controls include:

    • Access Restrictions: Efforts can be made to restrict the access to sensitive information or systems by employees who are not authorized.
    • Backup and Recovery Measures: Backup and recovery measures can be implemented to mitigate the risk of disruption in the event of a system failure or cyber-attack.
    • Technical Measures: Technical measures such as encryption or multi-factor authentication can be employed to ensure data security.
    • Process Change: Changes in process or procedures can also be made to enhance security measures.

    Limitations and Risks of Compensating Controls

    While compensating controls can be an effective tool to reduce the risk severity temporarily, there are some limitations and risks involved. Some of the limitations and risks of compensating controls include:

    • Increased Complexity: Implementing too many compensating controls can increase the complexity of the security program, making it more challenging to manage and maintain.
    • Limited Effectiveness: Compensating controls may not fully address the vulnerability resulting from inadequate or failed security measures, leaving the system exposed to potential breaches.
    • Dependence on Human Factors: Compensating controls may rely heavily on human factors such as awareness and training, which may not always be reliable or effective.
    • New Risks: Compensating controls can also introduce new risks, such as complacency or false sense of security.

    In conclusion, compensating controls can be useful when an organization faces constraints in meeting specific requirements for compliance or technological limitations. However, compensating controls should be viewed as temporary measures that do not address the root cause of the risk. Organizations should focus on implementing mitigating controls as a primary line of defense to reduce the likelihood of risk happening by addressing the root cause of the problem. Finally, to make compensating controls effective, organizations should develop, test, and monitor them regularly to ensure they are working as intended.