KPMG’s Risk Consulting practice has developed a paper to help clients learn how to incorporate their attitudes to risk taking into their day-to-day operations.
A risk appetite statement (RAS) is an element in a broader strategy designed to avoid unpleasant surprises and manage the risk and uncertainty that underlies all business activity.
Boards, Audit Committees and Chief Risk Officers may find this paper acts as a valuable tool for when reviewing and developing their risk appetite statements.
A well articulated risk appetite statement can:
- help resolve tensions in the business plan
- communicate the board’s vision in practical terms
- uncover opportunities and weaknesses that might otherwise have remained hidden
- quantify risks in terms of the type and level of risk that an organisation is prepared to accept.