Risk Appetite
Taking risk, eyes wide open
Risk Appetite – the board sets it, the executive champions it, managers operationalise it and staff need to live it. If you want faster, better decisions, within your appetite for risk, your goal must be to embed the appetite for risk taking you want deep into the DNA of your organisation. I can help you achieve this.
A great risk appetite statement
A successfully defined risk appetite will:
- Form an agreed position on the extent risk should be taken.
- Account for the risk-taking preferences of individuals.
- Accelerate decision making so 80% of priorities are reached 20% sooner.
An intelligent workforce can learn to adapt their decision making to defined boundaries if they fully understand the risk appetite of the organisation. By driving an understanding of risk appetite deep into your organisation’s DNA, you will find that staff will be spending more time on value-creating activities, less time on unimportant activities, and addressing way fewer consequences of poor decisions.
I can help you develop a risk appetite statement for your organisation that has substance, is relevant to the decisions people make and how they make them and is closely tied to the business plan and the other fundamentals of your business.
If you don’t have a risk appetite framework, or the one you have just “ticks a box” then we need to speak.
Ultimately it is about culture and following three royal commissions in the past five years in Australia, we have all the evidence we need that boards and executives must be driving a strong outcome culture while at the same time, driving a strong values culture. It’s like driving a car. One eye on the road, and another on the dashboard.
The biggest mistake you can make is to develop an appetite statement no staff believe. Make it convenient and bland, and you have wasted everyone’s time. Make it genuine, providing real guidance on the risks that need to be taken and the ones that should be avoided and your outcomes and value cultures will flourish.
