35 years: Strategic risk management and governance
An organisation's risk appetite is determined by its objectives, balance sheet strength, and the sorts of risks it faces, each company's risk appetite is distinct, and there is no one-size-fits-all solution. In this video, Hans explains how we can arrive at a risk appetite statement, how to use it to generate value, as well as the role of the Board in the process.
An organisation's risk appetite is determined by its objectives, balance sheet strength, and the sorts of risks it faces, each company's risk appetite is distinct, and there is no one-size-fits-all solution. In this video, Hans explains how we can arrive at a risk appetite statement, how to use it to generate value, as well as the role of the Board in the process.
13 mins 54 secs
Risk appetite is both a management and governance tool that allows businesses to make risk-return trade-offs in a controlled and transparent manner. Despite this, in many organisations it is only seen as a risk limitation or risk reduction measure. However, a well-crafted risk appetite framework should also encourage risk taking if the risk appetite is underutilised or opportunities with the right risk-return balance are presented.
Key learning objectives:
Define risk appetite
Understand how we arrive at an agreed risk appetite statement
Understand how risk appetite can add value to the organisation