Risk appetite / Risk team structure [5]

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Bullet points include: To ensure effective monitoring and governance, the risk appetite should incorporate a balanced mix of both: quantitative and qualitative targets Quantitative might include financial targets, e.g. capital adequacy, target debt rating, earnings volatility, credit or other external ratings Qualitative might include reputational impact, management effort, regulatory compliance More difficult to quantify, but ultimately organisations choosing to measure risk more precisely are still modelling such risks to determine their risk appetite on a more quantified basis

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