Free Cyber Risk Analysis: Uncover Your Cyber Risks vs. Peers in Just 3 Clicks

Get Started
Request Demo

Cyber Risk Quantification, FAIR

Factor Analysis of Information Risk (FAIR): an Actionable Definition


Risk modeling is an essential aspect of cybersecurity because it enables security practitioners to identify potential threats and control gaps, prioritize resources and investments, and develop strategies to manage and mitigate risks. By identifying potential threats and gaps in the existing cyber risk measures, leaders can take proactive steps to prevent or minimize the impact of an attack in real time.

Organizations can assess the likelihood of a cyberattack and its potential impact on their operations, finances, reputation, and customers by quantifying cyber risks. Risk modeling provides a framework for continuously improving and monitoring an organization's cybersecurity posture. By regularly reassessing risks and adapting their security strategies, organizations can stay ahead of evolving threats and maintain their resilience in the face of cyber attacks. 

Regular risk assessments and progress tracking are essential to communicate to business-side leaders and Board members as it shows the progress made and what may need more attention. While there are many approaches to risk modeling and quantification, the FAIR model is a gold-standard approach that provides usefulness to security teams, CISOs, and the Board. 

What is the FAIR Model? 

FAIR, which stands for Factor Analysis of Information Risk, is a framework for quantifying and managing information risk. It is a quantitative risk analysis methodology that helps organizations understand and evaluate their information security risks in a structured and consistent manner.

FAIR is central to cyber risk quantification and involves assessing the probability and impact of potential information security events, such as data breaches or cyber-attacks, and then using this information to assign a dollar value to the risk. By quantifying the risk in this way, organizations can make more informed decisions about allocating resources to manage the risk. 


Assigning a dollar value to cyber risk is crucial to its usefulness as it standardizes how CISOs can communicate risk to Board leaders. It translates risk into more accessible terminology. 

The FAIR framework consists of six steps:

Steps Actions
Scope of the Analysis Determine what assets and threats are in range for the analysis
Identify Threats Identify the potential events that could cause harm to the organization's assets
Identify Assets Identify the organization's assets that the identified threats could impact
Evaluate Loss Event Frequency Determine how frequently the identified threats could occur and affect the organization's assets
Evaluate Loss Magnitude Determine the potential impact of the identified threats on the organization's assets
Calculate Risk Use the information gathered in steps 4 and 5 to calculate the risk of each identified threat


Drive Data-Backed Decision-Making

The FAIR framework provides a standardized methodology for quantifying and managing information security risks, which can help organizations make more informed decisions about allocating resources to manage those risks. By understanding the potential financial impact of different security events and their likelihood of occurring financially, CISOs and security leaders can strategize with business-side leaders and align cyber risk management operations with business operations. 

Recognize the criticality of cyber risk on business success and establish a comprehensive cyber risk analysis approach with FAIR. To learn more about the risk models offered through the CyberStrong platform, schedule a conversation.

You may also like

Building Cyber Resilience: ...
on March 1, 2024

After several years of deliberation and collaboration with industry experts, NIST has released the newest version of the NIST CSF. The NIST CSF 2.0 builds on the draft version ...

How to Perform Cyber Risk Analysis ...
on February 26, 2024

In today's hyper-connected world, where data is the lifeblood of businesses and individuals alike, the threat of cyberattacks looms large. From sophisticated malware infiltrations ...

Decoding the Maze: A Guide to ...
on January 30, 2024

In today's digital age, organizations face the constant threat of cyber attacks. Safeguarding critical data and infrastructure requires a proactive approach, starting with a ...

January Product Update
on January 18, 2024

With the latest release of updates to the CyberStrong platform, we are dedicated to providing solutions that empower you to assess your cyber risk environment with the most ...

NIST CSF Adoption and Automation
on December 13, 2023

As a gold standard for cybersecurity in the United States and the foundation for many new standards and regulations starting to emerge today, the National Institute of Standards ...

Cyber Risk Quantification ...
on December 13, 2023

In an era dominated by interconnected systems and the ever-expanding digital landscape, cyber risk has transcended mere technical jargon to become a paramount concern for ...