Everyone quotes it. Almost nobody runs decisions by it. Here is where it usually breaks.
1
Written as a statement, run as nothing
2
Set once a year, then left alone
3
Sits in a policy, never in a decision
globalriskclinic.comSwipe →
MISTAKES·01 & 022 / 4
01
“It’s a one-page statement.”
Fix: appetite is a system, not a sentence. Turn every line into limits, thresholds and triggers per risk type, so people know when to stop.
02
“We set it once a year.”
Fix: revisit it when strategy, markets or regulation move. Appetite should follow the business, not the calendar.
globalriskclinic.com
THE COSTLY ONE3 / 4
03
“It lives in a policy,
not in decisions.”
Fix: wire appetite into the dashboard the board sees and the limits the front line works to. If a decision cannot be tested against it, the appetite is not real.
Try this at your next meeting: name one decision that changed because of your risk appetite.
globalriskclinic.com
WORK WITH US4 / 4
Make risk appetite
something people
actually use.
We help boards turn appetite into limits, triggers and a one-page view, using a full-lifecycle GRC method.
GRC Studio
All posts