A company's board of directors establishes a general willingness to accept a certain level of risk to achieve its strategic objectives. This is defined as the company's risk appetite. During project planning, a specific project is allowed to exceed this general level by a specified, measurable amount. What is this acceptable deviation from the risk appetite called?
Risk appetite is the overall amount of risk an organization is willing to accept to achieve its objectives. Risk tolerance is the specific, permissible deviation from the organization's risk appetite for a particular initiative or risk category. Risk identification is the process of finding and documenting risks, while a risk register is the document used to log and track these identified risks.
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What is the difference between risk appetite and risk tolerance?
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What is a risk register, and how is it used?
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How is risk identification performed in a project or organization?