inherent risk

Inherent risk refers to the likelihood of a specific risk occurring in the absence of any controls or measures to mitigate it. In various contexts, such as business or finance, it represents the natural level of risk involved in an activity or investment due to its nature and environment. For instance, a startup company inherently faces higher risks compared to an established business because of factors like market uncertainty and lack of experience. Understanding inherent risk helps individuals and organizations identify and evaluate potential challenges before implementing strategies to manage or reduce those risks.