thinQmaster Virtual testing partner Adaptive practice exams that find your weak spots and drill them. Every answer explained. From $69
Enroll

thinQmaster

Find your exam

Five questions free, before you decide.

Step 1 · choose a vendor

In one of our camps? Your practice exams come with the tuition — they are on your study page already.

Governance, Risk, Audit & Privacy · Foundational

Risk Appetite

Broad amount and type of risk an organization is willing to pursue or retain to achieve its objectives.

Definition

Risk appetite is set by the board and senior management and expressed in a risk appetite statement. It guides strategy and risk treatment decisions across the enterprise. It is more strategic and general than risk tolerance.

Example

The board states it has low appetite for regulatory noncompliance but moderate appetite for innovation risk.

Exam tip

Appetite is set by the board; tolerance is the acceptable variation; capacity is the maximum the organization can absorb.

Related terms