> ## Documentation Index
> Fetch the complete documentation index at: https://mintlify.com/AllianceBioversityCIAT/alliance-risk-analysis-tool/llms.txt
> Use this file to discover all available pages before exploring further.

# Risk Model Overview

> Complete risk assessment framework with 7 categories, 35 indicators, and traffic-light scoring methodology

The CGIAR Risk Intelligence Tool evaluates agricultural SMEs across **7 risk categories**, each containing **5 subcategories**, for a total of **35 risk indicators**. Every indicator is scored using a traffic-light system (Low / Moderate / High / Critical) based on quantitative and qualitative analysis.

## Risk Framework Structure

The risk model follows a hierarchical structure:

```
Overall Risk Score (0-100)
  └─ 7 Risk Categories (weighted average)
      └─ 5 Subcategories each (35 total indicators)
          └─ Traffic-light scoring (LOW / MODERATE / HIGH / CRITICAL)
```

## 7 Risk Categories

<AccordionGroup>
  <Accordion title="Financial Risk" icon="coins">
    Assesses the financial health and sustainability of the business.

    **5 Subcategories:**

    * Revenue Risk
    * Cost Structure Risk
    * Credit Risk
    * Liquidity Risk
    * Capital Structure Risk

    [View detailed scoring criteria →](/risk-model/financial)
  </Accordion>

  <Accordion title="Climate-Environmental Risk" icon="cloud-sun-rain">
    Evaluates exposure to climate change, weather patterns, and environmental sustainability.

    **5 Subcategories:**

    * Weather Exposure Risk
    * Climate Adaptation Risk
    * Water Resource Risk
    * Biodiversity Impact Risk
    * Carbon Footprint Risk

    [View detailed scoring criteria →](/risk-model/climate-environmental)
  </Accordion>

  <Accordion title="Behavioral Risk" icon="users">
    Analyzes management quality, governance practices, and organizational culture.

    **5 Subcategories:**

    * Management Competence Risk
    * Governance Structure Risk
    * Compliance & Ethics Risk
    * Innovation Capacity Risk
    * Stakeholder Relations Risk

    [View detailed scoring criteria →](/risk-model/behavioral)
  </Accordion>

  <Accordion title="Operational Risk" icon="cog">
    Examines operational efficiency, supply chain resilience, and production capabilities.

    **5 Subcategories:**

    * Supply Chain Risk
    * Production Process Risk
    * Technology & Equipment Risk
    * Human Resources Risk
    * Quality Control Risk

    [View detailed scoring criteria →](/risk-model/operational)
  </Accordion>

  <Accordion title="Market Risk" icon="chart-line">
    Assesses market position, competitive dynamics, and commercial viability.

    **5 Subcategories:**

    * Demand Risk
    * Competition Risk
    * Pricing Power Risk
    * Distribution Channel Risk
    * Regulatory Market Risk

    [View detailed scoring criteria →](/risk-model/market)
  </Accordion>

  <Accordion title="Governance & Legal Risk" icon="gavel">
    Evaluates legal compliance, contract management, and regulatory adherence.

    **5 Subcategories:**

    * Legal Structure Risk
    * Contract Management Risk
    * Intellectual Property Risk
    * Regulatory Compliance Risk
    * Reporting & Transparency Risk

    [View detailed scoring criteria →](/risk-model/governance-legal)
  </Accordion>

  <Accordion title="Technology & Data Risk" icon="server">
    Analyzes digital infrastructure, data security, and technology adoption.

    **5 Subcategories:**

    * IT Infrastructure Risk
    * Data Management Risk
    * Cybersecurity Risk
    * Digital Tools Adoption Risk
    * Analytics Capability Risk

    [View detailed scoring criteria →](/risk-model/technology-data)
  </Accordion>
</AccordionGroup>

## Scoring Methodology

### Risk Levels

Each subcategory and category is assigned one of four risk levels:

| Risk Level   | Score Range | Color Code    | Interpretation                                                        |
| ------------ | ----------- | ------------- | --------------------------------------------------------------------- |
| **LOW**      | 0-30        | 🟢 Green      | Minimal risk; business operates within acceptable parameters          |
| **MODERATE** | 31-60       | 🟡 Orange     | Manageable risk; some areas require monitoring or improvement         |
| **HIGH**     | 61-80       | 🟠 Orange-Red | Significant risk; requires immediate attention and mitigation         |
| **CRITICAL** | 81-100      | 🔴 Red        | Severe risk; threatens business viability; urgent intervention needed |

### Calculation Process

1. **Subcategory Scoring (35 indicators)**
   * Each subcategory is scored 0-100 based on data extracted from business plans, interviews, or manual data entry
   * AI agents analyze quantitative metrics and qualitative factors
   * Evidence from source documents is linked to each score

2. **Category Aggregation (7 categories)**
   * Category score = average of 5 subcategory scores
   * Example: Financial Risk = avg(Revenue, Costs, Credit, Liquidity, Capital)

3. **Overall Risk Score**
   * Overall score = weighted average of 7 category scores
   * All categories currently have equal weight (subject to change based on sector/region)

### Data Schema

Risk scores are stored in the `RiskScore` table with the following structure:

```typescript theme={null}
interface RiskScore {
  id: string;
  assessmentId: string;
  category: RiskCategory;  // FINANCIAL | CLIMATE_ENVIRONMENTAL | etc.
  score: number;           // 0-100
  level: RiskLevel;        // LOW | MODERATE | HIGH | CRITICAL
  subcategories: SubcategoryScore[];  // Array of 5 subcategories
  evidence: string | null; // Supporting evidence from documents
  narrative: string | null; // AI-generated explanation
  recommendations: Recommendation[];  // Mitigation strategies
}

interface SubcategoryScore {
  name: string;            // e.g., "Revenue Risk"
  indicator: string;       // e.g., "Revenue Concentration"
  score: number;           // 0-100
  level: RiskLevel;        // LOW | MODERATE | HIGH | CRITICAL
  evidence: string | null; // Specific data points
  mitigation: string | null; // Suggested actions
}
```

## AI-Powered Analysis

The risk assessment is performed by specialized AI agents using AWS Bedrock:

* **Risk Analysis Agent**: Analyzes business data across all 7 categories
* **Evidence Extraction**: Links scores to specific data points in source documents
* **Narrative Generation**: Creates human-readable explanations for each score
* **Recommendation Engine**: Generates prioritized mitigation strategies

All AI analysis is based on versioned prompts managed through the Prompt Manager, ensuring consistency and traceability.

## Use Cases

### For Analysts

* **Due Diligence**: Quickly identify high-risk areas in loan applications
* **Portfolio Monitoring**: Track risk trends across multiple assessments
* **Report Generation**: Export comprehensive PDF reports for stakeholders

### For Business Owners

* **Self-Assessment**: Understand business vulnerabilities
* **Improvement Planning**: Prioritize mitigation actions based on risk severity
* **Investor Communication**: Demonstrate risk management practices

### For Decision Makers

* **Investment Decisions**: Compare risk profiles across multiple SMEs
* **Policy Design**: Identify systemic risks in agricultural sectors
* **Resource Allocation**: Target support programs to highest-risk areas

## Next Steps

Explore detailed scoring criteria for each category:

<CardGroup cols={2}>
  <Card title="Financial Risk" icon="coins" href="/risk-model/financial">
    Revenue, costs, credit, liquidity, capital
  </Card>

  <Card title="Climate-Environmental Risk" icon="cloud-sun-rain" href="/risk-model/climate-environmental">
    Weather, adaptation, water, biodiversity, carbon
  </Card>

  <Card title="Behavioral Risk" icon="users" href="/risk-model/behavioral">
    Management, governance, compliance, innovation
  </Card>

  <Card title="Operational Risk" icon="cog" href="/risk-model/operational">
    Supply chain, production, technology, HR, quality
  </Card>

  <Card title="Market Risk" icon="chart-line" href="/risk-model/market">
    Demand, competition, pricing, distribution
  </Card>

  <Card title="Governance & Legal Risk" icon="gavel" href="/risk-model/governance-legal">
    Legal structure, contracts, IP, compliance
  </Card>

  <Card title="Technology & Data Risk" icon="server" href="/risk-model/technology-data">
    IT infrastructure, data, cybersecurity, analytics
  </Card>
</CardGroup>