Which term is the process of sharing risk with others?

Which term is the process of sharing risk with others?

• A. Risk transfer
• B. Risk sharing
• C. Safeguard
• D. Risk acceptance

Answer: (B)

Sharing risk means spreading potential losses and responsibilities across multiple parties rather than letting one entity bear the full burden. This approach distributes exposure so that no single organization faces the entire impact of a risk event. It’s about collaborative risk management—the contract or relationship allocates portions of risk to each participant, which can help manage uncertainty when risks are shared among partners, vendors, or stakeholders.

This differs from risk transfer, where the goal is to move the entire risk to another party (for example, purchasing insurance). It’s also not a safeguard, which is a control designed to reduce likelihood or impact, nor is it risk acceptance, which means choosing to endure the risk without transferring or mitigating it.