Читать книгу Non-financial Risk Management in the Financial Industry - Группа авторов - Страница 10

Following the definition of non-financial risk, chapter 3 provides a holistic approach to defining a non-financial risk appetite framework for financial institutions across three levels. This includes qualitative risk appetite statements for individual non-financial risk categories, outlining the level and types of risk that the financial institution is willing to take on in order to achieve its strategic objectives and business plan (level 1). Qualitative risk appetite statements are broken down into risk appetite metrics and corresponding thresholds, enabling institutions to set quantifiable tolerance levels for non-financial risk and underlying operational activities (level 2). Level 3 cascades the risk appetite framework to business lines and entity levels via pre-defined key risk indicators, facilitating the early detection of potential deviations from risk appetite objectives and potentially triggering timely interventions. The chapter also draws an outline of the corresponding governance that is required to operate a risk appetite framework.