Scoring Model

Every legal risk is measured across two independent axes:

Impact Magnitude (consequences if the risk becomes reality):

Rating	Descriptor	Meaning
1	Trivial	Minimal disruption; no meaningful financial, operational, or reputational consequence. Absorbed within day-to-day operations.
2	Minor	Contained impact; financial exposure under 1% of the relevant contract or transaction value; brief operational hiccup; no public visibility.
3	Substantial	Tangible impact; financial exposure in the 1-5% range of relevant value; noticeable operational interference; possibility of limited external attention.
4	Serious	Major impact; financial exposure between 5-25% of relevant value; significant operational disruption; probable public scrutiny; potential for regulatory interest.
5	Severe	Existential-level impact; financial exposure exceeding 25% of relevant value; core business operations threatened; material reputational harm; regulatory action anticipated; potential personal exposure for directors and officers.

Occurrence Probability (how likely the risk is to materialize):

legal-risk-scoring