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Risk Appetite Statement

What is Risk Appetite Statement?

A formal document expressing the board-approved levels and types of risk an organization is willing to accept in pursuit of its objectives.

Governance

Each of these is named in at least one of the same controls as risk appetite statement. The number is how many controls name both.

What the standards actually require on risk appetite statement

Requirements naming risk appetite statement across 6 standards, quoted from the control text.

The framework should require review and approval of the risk appetite statement by the board or its risk committee at least annually, or more often with the size and volatility of risks and material changes in business model, strategy, risk profile or market c...

occ-heightened-standards-12-cfr-part-30-appendix-d::II.G.1 · II.G.1 Annual board approval of the risk appetite statement →

The institution must maintain an appropriate, clear and concise risk appetite statement addressing its material risks, with the Board responsible for setting risk appetite and required to approve the statement.

CPS220-06 · Risk Appetite Statement →

The RSE licensee must maintain an up to date risk appetite statement covering its business operations and each category of material risk, approved by the Board.

SPS220-19 · Risk Appetite Statement →

The insurer must have a risk appetite statement that articulates the aggregate level and types of risk it will assume within its risk capacity to achieve its financial and strategic objectives and business plan, takes into account all relevant and material ris...

iais-insurance-core-principles-icps::16.4 · 16.4 A risk appetite statement covering aggregate risk, all material risk categories and operationalised through risk limits →

Catastrophe exposure is kept within the agreed appetites and tolerances. Baseline for natural and non-natural perils alike: there are risk appetite statements, exposures are monitored against them and reported to the board and senior management, and business p...

principles-for-doing-business-at-lloyd-s::P2.1 · 2.1 Manage catastrophe exposure within agreed risk appetites and tolerances →

A cyber risk appetite statement exists and has been approved by the board or its committee.

ffiec-cybersecurity-assessment-tool-cat::D1.G.Ov.Int.3 · D1.G.Ov.Int.3 Oversight (Intermediate 3) →

Questions people ask about risk appetite statement

What is Risk Appetite Statement?
A formal document expressing the board-approved levels and types of risk an organization is willing to accept in pursuit of its objectives.
Why is Risk Appetite Statement important for compliance?
Risk Appetite Statement is a key concept in Governance. Understanding risk appetite statement helps organizations meet regulatory requirements, reduce risk, and demonstrate due diligence during audits. Our compliance platform maps 1,016 frameworks with 316K cross-framework control mappings.
Which compliance frameworks address Risk Appetite Statement?
Risk Appetite Statement appears in the requirement text of OCC Heightened Standards (12 CFR Part 30, Appendix D), APRA CPS 220 Risk Management, APRA SPS 220 Risk Management (Superannuation), IAIS Insurance Core Principles (ICPs), Principles for Doing Business at Lloyd's. Across these standards we have identified 25 controls that name it directly, each linked to the control text on the compliance platform.
Where can I learn more about Risk Appetite Statement?
Explore our compliance framework pages to see how risk appetite statement applies across different standards and regulations. Our implementation guides provide step-by-step guidance, and the compliance platform offers AI-powered analysis of how this concept maps across 1,016 frameworks.

See how Risk Appetite Statement applies across compliance frameworks

Our platform maps 1,016 frameworks with 316K cross-framework control mappings. Explore how this concept is addressed across standards.

Written and maintained by Gerard Blokdyk, The Art of Service.