Risk Appetite
/ˈrɪsk ˈæpɪtaɪt/
Definitions
- (n.) The level of risk a legal entity or person is willing to accept in pursuit of objectives before action is deemed necessary to reduce the risk.
The board established the company's risk appetite to guide its investment decisions within acceptable parameters.
Related terms
See also
Commentary
Risk appetite informs governance policies and regulatory compliance frameworks by defining acceptable risk thresholds.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.