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Risk appetite / Risk team structure [51]

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Bullet points include: For all ‘major’ risks, defined ‘worst credible’ outcome as greatest loss that could result if certain key controls fail. Different from: ‘Inherent magnitudes’: assumes all controls fail or are absent; or ‘Residual magnitudes’: assumes all key controls are in place and functioning Probability of such outcomes evaluated for a specific time frame Often 2-5 years but potentially shorter for specific projects or business types Converted into a probability rating scale from “Remote” (less than 5% probability that event will occur in stipulated time frame) to “ Virtually Certain” (at least 95% probability)

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