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The definition of your organization’s risk appetite needs to be carried out by management and then a

Many organizations define risk as something to avoid. Playing the safest game possible has its merits, but a healthy, detailed definition of your organization's appetite for risk is critical to success in business. Boards increasingly recognize this and are asking for more insight into senior management's risk strategies including thoutsource in the corporate treasury department.

A new white paper Defining Your Risk Appetite, authored in conjunction with AFP, explains how boards and senior management teams can formulate effective risk appetite strategies that don't reflexively shun risk. Co-author Alex Wittenberg of Oliver Wyman believes an effective risk appetite statement must contain three characteristics:

  • a quantitative and qualitative foundation
  • relevance to a broad swath of stakeholders and
  • connection to key decision making processes across the firm.

Read more in the full white paper see AFP Org.

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