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Secure Controls Framework

What is risk tolerance?

Direct Answer

Risk tolerance is an organization’s willingness to accept a level of risk in pursuit of its objectives.

Risk tolerance helps executive leadership articulate how much uncertainty it is willing to accept. In general, risk tolerance:

  • Sets the overall strategic posture for an organization (in terms of risk management);
  • Translates “risk management” into defined boundaries; and
  • Helps trigger tactical actions.