What is the meaning of residual risk in risk management?

Residual risk in risk management refers to the remaining level of risk after all significant measures have been implemented to mitigate or control potential threats. It represents the portion of risk that cannot be eliminated and must be acknowledged and monitored. Organizations must assess residual risk to ensure it aligns with their risk tolerance and to develop strategies for managing it effectively. Understanding residual risk helps in making informed decisions about resource allocation and risk acceptance.