Optimized risk management is achieved when risk is reduced:

While strategic initiatives might contribute to risk reduction, the primary goal of optimized risk management is not merely using initiatives, but achieving an acceptable risk level.

Risk appetite is the amount and type of risk that an organization is willing to accept in pursuit of its objectives. Optimized risk management aims to bring the residual risk level within this acceptable threshold, balancing potential losses against the costs of risk treatment.

Reducing risk within resource availability is a practical constraint, but it doesn't define the optimal target for risk reduction; the target is defined by risk appetite.

Reducing risk below risk appetite might be possible but is often inefficient and costly, as it implies spending more resources than necessary to achieve an acceptable risk level.