Risk appetite: Difference between revisions
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imported>Doug Williamson (Align with qualifications material.) |
imported>Doug Williamson (Slight rewording to clarify the parameters and introduce risk tolerance.) |
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The amount of risk that an organisation is willing to accept in pursuit of value, improved financial performance or of other benefits, with management responsible for setting boundaries or parameters for risk taking.<br /> | |||
Any risk responses should be designed such that the 'net' (residual) risk after considering controls does not exceed these boundaries. | Risk appetite will be within or equal to the maximum risk tolerance. Any risk responses should be designed such that the 'net' (residual) risk after considering controls does not exceed these boundaries. | ||
Risk appetite is sometimes also known as risk attitude, risk capacity or risk tolerance. | Risk appetite is sometimes also known as risk attitude, risk capacity or risk tolerance. | ||
Revision as of 10:01, 3 June 2015
The amount of risk that an organisation is willing to accept in pursuit of value, improved financial performance or of other benefits, with management responsible for setting boundaries or parameters for risk taking.
Risk appetite will be within or equal to the maximum risk tolerance. Any risk responses should be designed such that the 'net' (residual) risk after considering controls does not exceed these boundaries.
Risk appetite is sometimes also known as risk attitude, risk capacity or risk tolerance.
See also
Other links
Risk appetite and risk tolerance: Practical guidance, www.theirm.org
