The University Risk Management and Insurance Association article delves into learning how risk appetite and tolerance statements can help answer “how much risk is too much risk.”
The story outlined how to leverage your institution’s risk register for decision-making, defined risk appetite statement and risk tolerance statement, and explained how UMB is putting this information into practice. The article came from a webinar that Victoria Meadows, MS, manager, ERM Program, UMB, gave through URMIA on Jan. 16. Below is an excerpt from the article, written by Meadows and Lisanne Sison, managing director, ERM and ESG, Gallagher:
UMB is working on establishing its risk appetite by focusing on its top five or top 10 risks and using these to set the thresholds for producing its risk appetite and tolerance statements.
There is some good comfort around how this is being done for UMB’s top risks, so now focus is shifting to help figure out how to set its appetite and tolerance for anything below its top 10 risks.
UMB’s ERM office is integrating this process with the University’s Strategic Plan, which, through its global outlook for the University, can help forecast some of the emerging risks that haven’t been thought of or may be coming in the future.