Risk appetite can be defined as 'the amount and type of risk that an organisation is willing to take in order to meet their strategic objectives'. Organisations will have different risk appetites depending on their sector, culture, and objectives. A range of appetites exist for different risks and these may change over time. Risk appetite and tolerance need to be high on any board's agenda and are a core consideration of an enterprise risk management approach. While risk appetite will always mean different things to different people, a properly communicated, appropriate risk appetite statement can actively help organisations achieve goals and support sustainability.

Audio by: Hersh Shah, SIRM

Source: IRM's Risk Appetite and Tolerance Guide