What are the most effective data visualization techniques for communicating risk to shareholders?

1 Risk heat maps

Risk heat maps are graphical representations of the likelihood and impact of different risks, using colors and sizes to indicate their relative importance. They are useful for showing the overall risk profile of an organization, and for highlighting the areas that require more attention or action. To create a risk heat map, you need to identify and prioritize the risks, assign them a likelihood and impact score, and plot them on a matrix. You can also use labels, icons, or symbols to add more details or categories to the risks.

3 Risk dashboards

Risk dashboards are interactive displays of key risk indicators, metrics, and trends, using various types of charts, gauges, and tables. They are useful for monitoring and reporting the current status and performance of the risk management process, and for alerting the shareholders to any changes or issues. To create a risk dashboard, you need to select the relevant indicators and metrics, define the thresholds and targets, and choose the appropriate visualization methods. You can also use filters, sliders, or buttons to enable the shareholders to explore the data and customize the view.

4 Risk maps

Risk maps are geographical representations of the spatial distribution and intensity of risks, using colors, shapes, or symbols to indicate their level or type. They are useful for showing the location and impact of risks that have a spatial dimension, such as natural disasters, market opportunities, or regulatory changes. To create a risk map, you need to collect and analyze the spatial data, select the risk indicators and categories, and choose the mapping technique. You can also use layers, tooltips, or legends to add more information or context to the map.

5 Risk stories

Risk stories are narratives that use data visualization and storytelling techniques to explain the causes, consequences, and actions related to a risk event. They are useful for engaging and persuading the shareholders, and for providing a comprehensive and coherent picture of the risk situation. To create a risk story, you need to identify the main message and audience, structure the story arc, and select the data visualization methods that support the story. You can also use text, images, or audio to enhance the story and make it more memorable.