GV.RM-02 - Defining Risk Appetite and Tolerance
GV.RM-02 requires organizations to define and communicate their risk appetite—the level of risk they are willing to accept—and translate it into specific, measurable risk tolerance statements. This clarity helps stakeholders understand acceptable risk thresholds, ensuring decisions align with strategic goals, such as innovation or stability. Regular maintenance of these statements keeps them relevant as risks evolve.
By establishing these boundaries, organizations can make informed choices about where to invest resources or accept residual risks, fostering consistency in risk management practices. It promotes transparency, enabling all levels of the organization to operate within agreed-upon limits. GV.RM-02 provides a critical framework for balancing risk and reward in cybersecurity efforts.
