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Risk Appetite and Risk Tolerance

Read this article and learn more about risk appetite and tolerance and how to take advantage of them in your business.

About the content

Do you know the risks to which your company is exposed? Do you monitor and control the use of resources in risk management so that the exposure meets the current risk appetite?
Knowing how to deal with risks can be a competitive advantage for companies. At some companies, appetite and risk tolerance are already considered when defining business strategies and are then broken down into indicators. This is such an important subject that in some sectors the elements of risk appetite and tolerance are determined by regulatory agents, as is the case with the financial system.
In this article, Hans Læssøe discusses the concepts involved in defining risk appetite and tolerance, showing the importance of knowing and using them. He explains that a company can have different levels of risk tolerance in different categories and how to take advantage of this.
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About the author

Hans Læssøe
Hans Læssøe is the founder of AKTUS Consulting Services. He has more than 35 years of experience with the LEGO Group in a number of areas, which has provided him with sharp business insight and a network to drive proactive strategic risk management. Mr. Læssøe is a founding member of a Danish ERM network as well as an executive member of the European Council of Risk Management and a Specialist member of the IRM. Mr. Læssøe is also a member of RIMS, where he serves on the “Strategic Risk Management Development Council.” The LEGO Group and Hans Læssøe have won multiple European awards for risk management approach implementation, and Hans has authored/co-authored articles in international magazines in addition to speaking at international risk management conferences.

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