ERM Concepts [24]

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Bullet points include: Risk profile: a complete description of the risk exposures of an organisation, including potential future risks. Risk appetite: the degree of risk an entity is willing to accept in order to achieve objectives –specified as enterprise-wide targets/limits with detailed breakdowns. Risk tolerance: a more detailed set of statements, many quantitative or statistical, applying to business units or specific categories of risk. Risk limits: guidelines setting limits on business unit actions – operating within permitted risk tolerences if risk limits are met. Risk capacity: how much risk an entity can handle, as measured by (say) Economic Capital, within its tolerances/limits. Organisation Objectives. Strategy. Risk Tolerance. Business Unit Plans. Units

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