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Risk appetite

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How much risk, and of which kinds, an organisation is prepared to take on in pursuit of its objectives 1. In this book it is compiled from an approved statement into a versioned data file that gates read, rather than left in a board paper.

Developed in
ch. 13, Risk appetite and tolerance, compiled into gates
Chapters
ch. 13, Risk Management
Contrast with
Risk tolerance
Source
1 numbered reference, listed below

Commonly confused

  • Risk appetite versus Risk tolerance

    Risk appetite
    How much risk, and of which kinds, an organisation is prepared to take on in pursuit of its objectives.
    Risk tolerance
    The readiness to bear a given risk in order to achieve objectives.

    The differenceHow much risk the organisation will take on overall, against the residual band one system may carry.

    Why it mattersAppetite is a board statement compiled to data; tolerance is the threshold a deploy gate reads.

Where it is used

5 chapters of the Body of Knowledge use the term. Each link opens the first section that does.

Risk appetite: mentions per chapter6 mentions of the term across 5 of the 23 chapters of the Body of Knowledge; the chapters the glossary cross-references are drawn solid.Cross-referenced chapterOther chapter00 Preface: 1 mention00 Preface104 The Stack: 1 mention04 The Stack111 AI Defined: 1 mention11 AI Defined112 Governance Program: 1 mention12 Governance Program113 Risk Management: 2 mentions13 Risk Management2No mentions in the other 18 chaptersSource: the Body of Knowledgev0.5.0
Risk appetite: mentions per chapter6 mentions of the term across 5 of the 23 chapters of the Body of Knowledge; the chapters the glossary cross-references are drawn solid.Cross-referenced chapterOther chapter00 Preface: 1 mention10001020304 The Stack: 1 mention104050607081011 AI Defined: 1 mention11112 Governance Program: 1 mention11213 Risk Management: 2 mentions21314151617181920212223Source: the Body of Knowledge v0.5.0
Mentions per chapter How often each chapter names the term, with the chapters the glossary cross-references drawn solid. The longest bar is where to read the term in use; bars spread across many chapters mark a term that runs through the discipline.
Mentions as a table
Mentions of Risk appetite per chapter
ChapterMentionsCross-referenced
00 Preface1No
01 Definition0No
02 Why Now0No
03 Values & Principles0No
04 The Stack1No
05 Patterns0No
06 The Role0No
07 Maturity Model0No
08 Regulatory Map0No
10 Reading List0No
11 AI Defined1No
12 Governance Program1No
13 Risk Management2Yes
14 Development0No
15 Deployment0No
16 Fairness & XAI0No
17 Incidents0No
18 EU AI Act0No
19 Privacy & AI0No
20 Existing Law0No
21 AI Laws Worldwide0No
22 Principles & Standards0No
23 AI Agents0No

Sources

  1. [1] ISO 31073:2022, Risk management: Vocabulary (replaced ISO Guide 73:2009, withdrawn; referenced by identifier only). ISO/TC 262. 2022-02. https://www.iso.org/standard/79637.html (verified: primary)

Definitions of legal terms paraphrase the cited text, which governs. Dated statements are as of .

Cite this term

García Aibar, J. (2026). Risk appetite. In AI Governance Engineering: The Thesis & Body of Knowledge (v0.5.0), Glossary. https://doi.org/10.5281/zenodo.22956197. https://aigovernanceengineer.com/glossary/risk-appetite. CC BY 4.0

BibTeX

@misc{aige2026riskappetite,
  author  = {Jorge García Aibar},
  title   = {{Risk appetite}},
  note    = {Glossary, AI Governance Engineering: The Thesis \& Body of Knowledge, version 0.5.0},
  year    = {2026},
  doi     = {10.5281/zenodo.22956197},
  url     = {https://aigovernanceengineer.com/glossary/risk-appetite}
}