Measuring and Managing Information Risk: A FAIR Approach

Measuring and Managing Information Risk: A FAIR Approach

Book written by Jack Freund and Jack Jones

Book review by Ben Rothke

Executive Summary

One is hard pressed to go a day without encountering some sort of data about information security and risk. Research from firms like Gartner are accepted without question, even though they can get their results from untrusted and unvetted sources.

Panic around Ebola and other rare events shows how people are ill-informed about risk. While distressing over Ebola, the media is oblivious to true public health threats like obesity, heart disease, drunk driving, diabetes, and the like.

When it comes to information security, the situation is not much better. With myriad statistics, surveys, data breach reports and costs, global analyses and the like, there is an overabundance of data but an under abundance of meaningful data.

In Measuring and Managing Information Risk: A FAIR Approach, authors Jack Freund and Jack Jones have written a magnificent book that will change (for the better) the way you think about and deal with IT risk.


The book details the factor analysis of information risk (FAIR) methodology, which is a proven and credible framework for understanding, measuring, and analyzing information risk of any size or complexity.

An Open Group standard, FAIR is a methodology and a highly effective, quantitative analysis tool. The power of FAIR is immense: it enables the risk practitioner to make well-informed decisions based on meaningful measurements. While that seems obvious, in practicality, it is a challenging endeavor.

FAIR is invaluable in that it helps the risk professional understand the language that the corporate board and senior executives speak. Understanding that, and communicating in their language, can make it much easier for information security to be perceived as a valued asset, as opposed to using Chicken Little statistics. FAIR takes the risk professional out of the realm of dealing with risk via the checklist; which only serves to produce meaningless measurements, into the world of quantitative, defendable results.

For those who are looking for a tool to create pretty executive summary charts with lots of colors, FAIR will sorely disappoint them. For those who are looking for a method to understand how to calculate qualitative risk to support a formal enterprise risk management program, they won’t find a better guide than this book.

Measuring and Managing Information Risk is an incredibly good reference that will force you to look again at how you view risk management. As Jones writes in the preface, the book is not about checklists and formulas, but about critical thinking.

The authors note that information security and operational risk have operated for far too long as art, without enough science. This is the gap that FAIR attempts to fill. The authors also write that risk decision-making quality boils down to the quality of information decision-makers are operating from, and the decision-makers themselves. The book does a remarkable job of showing how a person can become a much better decision-maker.

A subtle but important point the book makes early on is that many risk professionals confuse risk possibilities with risk probabilities. The FAIR method forces you to focus on probabilities and not to obsess on Ebola-like possibilities. Such a quantitative analysis approach is what makes FAIR so beneficial.

The book spends a few chapters going through FAIR risk ontology and terminology. Inconsistent and poorly defined terminology is one of the most significant challenges the information security and operational risk profession faces. Having a consistent set of logical terms and definitions that make up the FAIR framework significantly improves the quality of risk relations communications within an organization.

The value of having a consistent set of logical terms and definitions is significant. For example, the book notes that many people use the term threat. In the context of risk analysis, it might not be a real threat if there is no resulting loss. In that case, it would be considered a vulnerability event.

The challenge of FAIR is acclimating to its dialect. But once done, it creates an extremely powerful methodology for risk communication and management. And therein lies its power. Setting up a common framework for risk management becomes an invaluable tool to present risk ideas. In addition, it makes the findings much more objective and defendable.

In Chapter 5, the authors address the biggest objection to quantitative risk management: it can’t be measured or is simply unknowable. They agree that risk can’t be measured at the micro level, but it can be effectively measured to the degree to reduce management’s uncertainly about risk.

They also, importantly, note that risk is a forward-looking statement about what may come to pass in the future. With that, perfect accuracy is impossible; but, effective quantitative risk management is very possible.

The power of FAIR is that is helps add clarity to ambiguous risk situations by giving you the tools to add data points to a situation that is purported to be unknowable.

Chapter 8 is an extremely enlightening one, in that it provides 11 risk analysis examples. The examples do a great job of reinforcing the key FAIR concepts and methods.

In Chapter 10, the authors write that the hardest part of learning FAIR is having to overcome bad habits. For most people, FAIR represents a recalibration of your mental model about what risk is and how it works. The chapter deals with common mistakes and stumbling blocks when performing a FAIR analysis. The five, high-level categories of mistakes the chapter notes are: checking results, scoping, data, variable confusion and vulnerability analysis.

FAIR is a powerful methodology that can revolutionize risk management. The challenge is that it takes a village to make such a change. Management may be reticent to invest in what is perceived as yet another risk management framework.

But once you start using the language of FAIR and validate your findings, astute management will likely catch on. Over time, FAIR can indeed become a risk management game changer.


There are plenty of security books that will give you a basic overview of risk management.  It is sort of like giving a person a fish. For those who are looking to master the art of risk management, and learn how to fish, Measuring and Managing Information Risk: A FAIR Approach is one of the best books you can add to your library.

The book is flawless in its execution and description of the subject. The only critique is that the authors should have been a bit more transparent in the text when (especially in Chapter 8) mentioning the FAIR software, in that it is their firm that makes the software.

For those who are willing to put in the time to understanding FAIR, this book will make their jobs much easier. It will help them earn the trust of senior management and make them much better risk management professionals in the process.

This is a book that will stand the test of time and be valuable to risk management professionals for years to come, which makes it a worthy entrant into the Cybersecurity Canon.

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