A Short Guide to Risk Appetite (Paperback) book cover

A Short Guide to Risk Appetite

By David Hillson, Ruth Murray-Webster

© 2012 – Routledge

168 pages

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Paperback: 9781409440949
pub: 2012-11-28
$39.95
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eBook (VitalSource) : 9781315263601
pub: 2017-03-02
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Description

How much risk should we take? A Short Guide to Risk Appetite sets out to help all those who need to decide how much risk can be taken in a particular risky and important situation. David Hillson and Ruth Murray-Webster introduce the RARA Model to explain the complementary and central roles of Risk Appetite and Risk Attitude, and along the way they show how other risk-related concepts fit in. Risk thresholds are the external expression of inherent risk appetite, and the challenge is how to set the right thresholds. By progressively deconstructing the RARA Model, the authors show that the essential control step is our ability to choose an appropriate risk attitude. The book contains practical guidance to setting risk thresholds that take proper account of the influences of organisational risk culture and the individual risk preferences of key stakeholders. Alongside this, individuals and organisations need to choose the risk attitude that will optimise their chances of achieving the desired objectives.

Reviews

’…while many organisations, across various industries, are talking about risk appetite, the majority are struggling to define and measure it. This short but comprehensive guide provides a practical approach to do just that…In a nutshell, the book successfully delivers an insight into risk appetite, how to measure it and, above all, how to implement the RARA model and use it in key decision-making. The best part? Human factors are well catered for (risk culture, decision-making and risk leadership). In conclusion, this is an interesting insight for risk management academicians and a must-read for practitioners to take the subject forward.’ Monika Narula, Risk Management Professional ’…this is another intriguing title from Gower’s Short Guides to Business Risk series and it’s clear the authors are well versed on the subject in hand. Risk appetite is a complex subject and Hillson and Murray-Webster tackle it well with useful definitions from regulators, standards, professional associations and reputable consultants.’ Quality World, March 2014

Table of Contents

Contents: Foreword; Preface; Why is risk appetite important?; The risk appetite story so far; Terminology wars; Putting the pieces together: the RARA model; Applying the RARA model: making risk-informed decisions; Practical implications: what can we measure?; Using the RARA model in practice; Conclusions; Index.

About the Authors

David Hillson is a recognised global authority on risk management, with a reputation and track record of blending leading-edge thinking with practical expert application. David is a frequent author and speaker on risk.

About the Series

Short Guides to Business Risk

Risk is a far more complex and demanding issue than it was ten years ago. Risk managers may have expertise in the general aspects of risk management and in the specifics that relate directly to their business, but they are much less likely to understand other more specialist risks. Equally, Company Directors may find themselves falling down in their duty to manage risk because they don't have enough knowledge to be able to talk to their risk team, in a sensible way. The short guides to risk are not going to make either of these groups experts in the subject but will give them plenty to get started and in a format and an extent (circa 150 pages) that is readily digested.

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Subject Categories

BISAC Subject Codes/Headings:
BUS104000
BUSINESS & ECONOMICS / Corporate Governance