Material Risk
What is Material Risk?
A risk of sufficient magnitude that its occurrence could significantly affect the organization's financial condition, operations, or reputation.
Terms that appear alongside material risk
Each of these is named in at least one of the same controls as material risk. The number is how many controls name both.
- risk management framework 10 shared controls
- risk appetite 6 shared controls
- risk appetite statement 6 shared controls
- remediation 3 shared controls
- compliance 3 shared controls
- risk governance 3 shared controls
- risk culture 3 shared controls
- governance 3 shared controls
Frameworks that govern material risk
What the standards actually require on material risk
Requirements naming material risk across 6 standards, quoted from the control text.
The risk management framework must provide a structure for identifying and managing each material risk so the institution is prudently and soundly managed, having regard to the size, business mix and complexity of its operations.
CPS220-P22 · Framework Structure for Managing Each Material Risk →The RSE licensee must ensure at a minimum that its risk management framework covers all material risks to its business operations, both financial and non financial, having regard to the size, business mix and complexity of those operations.
SPS220-18 · Framework Coverage of All Material Risks →The CIRMP must identify each hazard where there is a material risk that the occurrence of the hazard could have a relevant impact on the critical infrastructure asset.
CIRMP-s6 · Identification of material risks →The entity must maintain a comprehensive service provider management policy covering how it identifies material service providers and manages service provider arrangements, including managing the material risks those arrangements create.
CPS230-37 · Service Provider Management Policy →Risk management reports should cover all material risk areas within the organisation. The depth and scope of these reports should be consistent with the size and complexity of the bank's operations and risk profile, as well as the requirements of the recipient...
BCBS239-P8 · Comprehensiveness →Operate Internal Audit per 12 CFR Part 30 Appendix D Section II.C.3. Internal Audit must (a) be a function independent of the front line units and Independent Risk Management with authority and independence to provide assurance to the Board on the design and o...
OCCHS-5 · Internal Audit: Independence, Scope, Methodology, and Reporting →Questions people ask about material risk
What is Material Risk?
Why is Material Risk important for compliance?
Which compliance frameworks address Material Risk?
Where can I learn more about Material Risk?
See how Material Risk applies across compliance frameworks
Our platform maps 686 frameworks with 311K cross-framework control mappings. Explore how this concept is addressed across standards.