Key Risk Indicator
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A Key Risk Indicator, also known as a KRI, is a measure used in management to indicate how risky an activity is. It differs from a Key Performance Indicator (KPI) in that the latter is meant as a measure of how well something is being done while the former is an indicator of the possibility of future adverse impact.
The Risk Management Association (RMA) manages the KRI Library and Services (http://www.kriex.org/), an initiative designed for financial services companies that are interested in improving their operational risk management. According to their webpage, the KRI Library Services grew out of a two year Banking KRI Study initiated and now managed by the RMA in conjunction with RiskBusiness International, a global operational risk management company.
The KRI Services initiative is led by an industry Steering Group, currently made up of representatives of ABSA, Citigroup, Commonwealth Bank of Australia, Dresdner, Erste Bank, Investec, Kleinwort, KeyCorp, Royal Bank of Canada, State Street and Wachovia.
Participation in the KRI Services is open to financial institutions globally, including banks, broker dealers, fund/asset managers, insurers and central banks.
KRIs are referenced to in an ITGI May 2007 draft titled "IT Control Objectives for Basel II: The Importance of Governance and Risk Management for Compliance Exposure".
KRIs are a mainstay of Operational Risk analysis.