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Risk Tolerance Governance: Turning Boundaries into Strategic Advantage
- Julien Haye
- Aug 2
- 17 min read
Updated: Aug 30
Introduction: Why Risk Tolerance Fails to Deliver
Risk tolerance is one of the most important, yet least operationalised, elements of enterprise risk management. Many organisations define it in board-approved frameworks, monitor it through static reporting, and revisit it only after a breach or audit finding. In practice, it often fails to shape trade-offs, inform decisions, or provide meaningful escalation triggers.
Research by Amy Edmondson, Professor at Harvard Business School, offers insight into why this happens. In her seminal 1999 study on team learning and psychological safety, Edmondson found that even well-established frameworks break down unless the environment supports open communication, error reporting, and cross-functional challenge. Without psychological safety, risk tolerance thresholds fail to influence behaviour, escalate insights, or guide real decisions.
This playbook presents a different approach. It positions risk tolerance as the operational bridge between strategy, risk appetite, and execution. Anchored in clear thresholds, governance discipline, cultural reinforcement, and forward-looking measurement, it enables boards and executives to make faster, better-informed decisions and navigate risk with confidence.
At Aevitium LTD, we use this approach to help leaders move beyond compliance and build risk tolerance as a strategic capability. This playbook outlines the practical steps, governance mechanisms, and cultural enablers required to embed risk tolerance into the fabric of the enterprise.
Whether you are a board director seeking assurance, an executive leading transformation, or a CRO building enterprise-wide risk capability, this guide is designed to turn risk tolerance into a tool for leadership, resilience, and value creation.
Risk Appetite, Tolerance, and Capacity – A Focused View
Before embedding risk tolerance into governance, it is essential to clarify how it relates to risk appetite and risk capacity. While often used interchangeably, each concept plays a distinct role:
Risk Appetite – The level of risk an organisation is willing to take in pursuit of strategic objectives. It reflects intent and ambition.
Risk Tolerance – The acceptable range of variation around appetite before escalation is required. It translates ambition into actionable boundaries.
Risk Capacity – The absolute limit of risk the organisation can bear without breaching financial, operational, or regulatory constraints.
These three elements form a continuum. Appetite sits within capacity, and tolerance provides the operational buffer that signals when intervention is required.
When organisations blur these concepts, tolerance frameworks lose credibility. Clear distinctions allow boards and executives to:
Anchor thresholds to risk strategy and capacity
Monitor drift from appetite in real time
Escalate early before limits are breached
This clarity is the foundation for effective tolerance governance, ensuring that thresholds actively guide decisions and create clarity rather than becoming mere documentation.
Risk Tolerance Alignment with Strategy and Value Creation
Risk tolerance must be anchored in strategy. It is not simply a control mechanism; it defines the organisation’s willingness to take risk in pursuit of its objectives. When tolerance is disconnected from strategy, it becomes an administrative exercise. When it is integrated, it becomes a decision-making tool that guides how ambition is translated into action and ensures risk is managed as a driver of value, not just a constraint. It is also critical for orderly wind-down planning.
As outlined in Risk Appetite: From Approval to Impact, risk appetite provides the directional intent, while tolerance operationalises it by defining the boundaries within which leaders can act.
To achieve this, leading organisations:
Align tolerance levels with strategic priorities and risk appetite
Tolerance should mirror the organisation's strategic ambitions rather than defaulting to a “lowest common denominator” approach. For example, a growth-driven strategy may require a higher tolerance for operational risk in fast-moving markets, while a regulatory-driven transformation may demand tighter thresholds for compliance breaches. By anchoring tolerance to appetite, leaders create a consistent risk narrative from the boardroom to the front line.
Balance value creation against acceptable risk exposure
Risk tolerance enables boards and executives to evaluate risk-reward trade-offs explicitly. Accepting higher risk in one area (e.g. technology change) may be justified if it enables value creation, provided that risk is offset elsewhere or managed within clear boundaries. This approach fosters sustainable performance rather than unchecked risk-taking.
Distinguish between risk capacity (what can be absorbed) and risk tolerance (what is chosen)
Risk capacity sets the outer limit of what the organisation can bear. Tolerance should be deliberately set below capacity, signalling that leadership chooses discipline over expediency. This distinction prevents tolerance from becoming a proxy for technical limits and reinforces its role as a governance tool.
Recalibrate tolerance dynamically in response to regulatory, market, and competitive shifts
Tolerance cannot be static. It should be reviewed regularly and adjusted when external factors change. For example, a tightening regulatory environment may require lowering compliance risk tolerance, while the launch of a high-priority product may justify temporarily increasing operational risk tolerance within defined boundaries. Dynamic recalibration ensures tolerance remains relevant and credible.
When risk tolerance is anchored in strategy and linked to risk appetite, it becomes a practical governance mechanism that turns thresholds into actionable decision tools. This alignment enables informed trade-offs and reinforces confidence that risk is being managed to support sustainable performance and long-term value creation.
Governance and Escalation Discipline
Clear governance structures ensure that risk tolerance operates as a living control framework rather than a theoretical boundary. Without this discipline, thresholds risk becoming little more than reference points, detached from decision-making as we are seeing in our field work. Effective governance turns tolerance into a mechanism for action, accountability, and confidence.
a. Define tolerance thresholds that translate into measurable triggers
Tolerance must be translated into clear, actionable thresholds that leave no room for ambiguity. These triggers should be directly linked to the organisation’s risk profile and strategic objectives so that everyone, from the boardroom to the front line, understands when action is required.
In practice, this means defining risk tolerance in measurable terms that can be monitored and acted upon. For example, instead of a generic statement such as “low tolerance for regulatory breaches,” an actionable threshold could be:
Zero tolerance for material breaches with automatic escalation to the risk committee.
Up to two minor control breaches per quarter before a review is triggered.
Customer complaint levels above 0.5% of total transactions to be flagged for executive attention.
These thresholds should be tailored to each risk type and expressed in a way that is easy to understand and operationalise.
These triggers should be directly linked to the organisation’s risk profile and strategic objectives.
This means aligning each threshold with both the risks the organisation faces and the outcomes it is trying to achieve. For example:
In a growth-focused strategy, operational risk tolerance might allow for higher change-related incidents if they accelerate market entry.
In a compliance-intensive environment, tolerance for policy breaches may be set near zero, reflecting regulatory expectations and the organisation’s reputation objectives.
When thresholds are defined this way, everyone from the boardroom to the front line knows what “too much risk” looks like and exactly when escalation is required, removing the ambiguity that often leads to delayed or inconsistent decisions.
b. Link tolerance to key risk indicators and performance metrics
Thresholds are only meaningful when connected to metrics that provide timely insight. By linking tolerance to key risk indicators (KRIs) and relevant performance measures, organisations turn abstract limits into actionable governance tools.
In other words:
Thresholds without metrics are theoretical; you do not know if you are about to cross them until it is too late.
Metrics (KRIs and performance indicators) act as early-warning signals, showing whether risk is drifting toward or beyond tolerance.
Integration with performance measures (e.g. error rates, compliance breaches, customer complaints) ensures tolerance is not monitored in isolation but in the context of business performance.
Example:
Tolerance: “No more than 2 high-severity compliance breaches per quarter.”
Linked metrics: Compliance breach reports, audit findings, and issue closure timelines.
Practical outcome: The risk committee can see if breaches are rising toward the limit and act before tolerance is breached (e.g. by allocating resources, tightening controls, or adjusting risk appetite).
c. Establish clear escalation pathways and decision rights
Even the best thresholds fail if there is no discipline around escalation. Defining who owns decisions, how breaches are reported, and what actions must follow creates a predictable response mechanism. This ensures that risk management is not reactive but structured, transparent, and consistent across the organisation.
For example, if a technology risk threshold is breached due to a critical system outage, ownership might rest with the CIO, who must notify the risk committee within 24 hours. An immediate containment plan would be triggered, with predefined escalation to the board if the outage impacts customer service for more than 48 hours. This clear chain of accountability avoids ad hoc decision-making and ensures that senior leaders have the visibility they need to act decisively.
Similarly, in financial risk, a trading limit breach could automatically escalate to the CFO and the risk oversight function, with an enforced review of the underlying control breakdown before trading resumes. By codifying these escalation pathways, organisations eliminate ambiguity, reinforce accountability, and give risk tolerance practical authority in day-to-day decisions.
In our discussion with Britta Achmann on RiskMasters, we explored how market risk is evolving in a world of hyper-automation and artificial intelligence. Britta noted that market risk managers are likely to shift from operational monitoring to a more strategic role, with market risk limits, triggers, and surveillance increasingly automated. This evolution reinforces the importance of clear escalation protocols: while technology will detect breaches faster, effective governance depends on human oversight to interpret results, exercise judgment, and ensure that escalation mechanisms remain robust in an automated environment.
d. Integrate tolerance into risk committee oversight, investment decisions, and transformation programs
Tolerance should not be confined to risk reporting packs. It must be embedded in the governance forums where material decisions are made. Boards and risk committees should review tolerance thresholds and breaches regularly, using them as a lens to challenge investment priorities, transformation plans, and operational trade-offs.
For example, if a major transformation initiative would push operational risk tolerance close to its defined limit, the risk committee should require explicit mitigation plans or a temporary tolerance adjustment approved by the board. This prevents “silent drift” where risk builds without visibility until it becomes a compliance issue or a crisis.
Similarly, in capital allocation decisions, linking risk tolerance to investment governance enables boards to weigh risk-reward trade-offs transparently. A decision to accelerate a high-growth initiative in a competitive market, for instance, may be justified only if risk tolerance for technology or compliance is temporarily relaxed and offset by tighter controls in other areas.
e. Maintain documented evidence of tolerance decisions for stakeholders and regulators
What is not written, does not exist.
Effective governance requires an auditable trail of risk-related decisions. Documenting the rationale for threshold breaches and subsequent actions not only strengthens internal accountability but also builds confidence with regulators and other stakeholders that risk is being managed with rigor and transparency.
For example, if a compliance risk threshold is breached due to a regulatory finding, the risk committee should record the root-cause analysis, the corrective actions agreed upon, and the decision-making timeline. This documentation creates a defensible record that demonstrates both proactive governance and clear ownership of remediation.
Similarly, in financial risk, if a temporary adjustment to market risk tolerance is approved to pursue a strategic trading opportunity, the decision and its justification should be formally captured in the risk governance framework. This ensures that boards and regulators can trace how risk appetite, capacity, and tolerance were balanced in practice.
Culture and Behavioural Reinforcement
Even the most sophisticated risk governance framework will fail if culture undermines it. Risk tolerance cannot be enforced solely through policies; it must be lived through leadership, behaviours, and decision-making across the organisation.
Strong risk culture depends on clear tone from the top, visible leadership accountability, and an environment of psychological safety where a healthy speaking-up culture and challenge and escalation are encouraged rather than feared.
The Risk Within provides a roadmap for embedding psychological safety into risk management. It identifies critical touch points across the risk lifecycle and offers clear actions to align leadership, culture, and governance. It is designed to help risk functions integrate more deeply into the business and strengthen decision-making at every level.
When supported by documented evidence and aligned with regulatory compliance in risk governance, this cultural foundation not only reinforces risk behaviours but also ensures that behavioural risk signals are surfaced early and acted upon.
This is where risk tolerance becomes more than a control mechanism. It becomes a shared standard for how the organisation takes risk responsibly, makes trade-offs transparently, and builds sustainable confidence among boards, executives, regulators, and stakeholders.
Do’s and Don’ts for Embedding Culture into Risk Tolerance Governance
✅ Do’s
Foster a speaking-up culture: Encourage employees at every level to raise concerns without fear of retaliation. Embed psychological safety so that challenge is seen as a contribution to effective risk governance framework rather than a threat.
Reinforce tone from the top: Senior leaders and the board must demonstrate leadership accountability by treating tolerance breaches seriously, escalating issues transparently, and modelling disciplined risk behaviours.
Integrate behavioural risk signals into oversight: Use ERM processes to track and review cultural indicators (such as low levels of escalation or repeat near-misses) alongside traditional risk metrics.
Convert lessons into action: After an incident or near-miss, ensure that both controls and behaviours are reviewed. Feed these insights back into governance forums to strengthen risk oversight and build organisational resilience.
Link culture to regulatory assurance: Document how cultural enablers, like challenge and escalation processes, support regulatory compliance in risk governance. This builds confidence with both internal and external stakeholders.
❌ Don’ts
Do not treat culture as intangible: Avoid relying solely on policies or training. Without clear measurement of risk awareness and behaviours, risk culture remains aspirational rather than operational.
Do not ignore leadership signals: Mixed messages from senior executives such as downplaying tolerance breaches undermine board risk governance and erode trust in the risk governance framework.
Do not punish constructive challenge: Retaliating against those who escalate concerns destroys psychological safety and silences early warning signals critical for risk decision-making.
Do not separate culture from governance: Cultural enablers must be embedded in risk oversight, escalation protocols, and reporting. Treating them as “soft” factors isolates them from formal risk control environments.
Do not delay cultural course corrections: Failing to act on repeated behavioural risk signals—such as recurring late escalations—allows small issues to compound into material risk events.
If you're curious how your leadership environment supports or constrains risk visibility, try the Leadership Behaviour Insight Assessment. It’s designed to help you reflect on the behaviours that shape risk culture and psychological safety in practice.
Measurement and Forward-Looking Insights
Risk tolerance must be measurable, monitored, and stress-tested to ensure it drives risk-informed decision-making and supports enterprise risk governance. By combining leading indicators, stress testing, and analytics, leaders can move from backward-looking risk reports to predictive oversight that anticipates breaches before they happen.
1. Define clear and balanced tolerance levels
Tolerance should reflect both what the organisation can absorb (risk capacity) and what it chooses to accept (risk tolerance) to achieve its objectives.
How to:
Translate risk appetite into quantitative thresholds (e.g. maximum loss limits, capital or liquidity buffers).
Set qualitative boundaries for non-negotiable areas (e.g. regulatory breaches, ethical violations).
Validate thresholds in board and risk committee forums to ensure alignment with strategic objectives.
Document the rationale to meet regulatory compliance in risk governance expectations.
2. Use early-warning indicators to stay ahead
Leading indicators provide predictive visibility into risks before they escalate.
How to:
Identify key risk indicators (KRIs) for each tolerance threshold.
Add early-warning indicators (e.g. rising project change requests, high staff turnover in control teams, vendor performance slippage).
Map indicators into risk dashboards integrated with business performance metrics.
Review metrics in risk oversight forums to ensure continuous relevance.
3. Validate thresholds through scenario analysis and stress testing
Tolerance is only credible if tested against real-world and extreme conditions.
How to:
Perform scenario analysis to model plausible disruptions (e.g. cyber breach, regulatory shift, major market shock).
Run stress testing to confirm tolerance holds under severe but plausible scenarios.
Apply reverse stress testing to identify tolerance breaking points and resilience gaps.
Present findings to boards to inform risk decision-making and strengthen confidence with regulators.
4. Build real-time visibility through dashboards and analytics
Governance requires timely, actionable insight—not static reports.
How to:
Create risk dashboards combining KRIs, tolerance breaches, and business performance metrics.
Use risk analytics to forecast potential breaches and model risk-reward trade-offs.
Embed dashboards into executive and risk committee reporting packs for data-driven discussions.
Ensure dashboards provide drill-down capability for second-line oversight and board-level summaries.
5. Link tolerance to resilience and performance
Tolerance should enable the organisation to manage risk and seize opportunities without undermining stability.
How to:
Connect tolerance to resilience measures (e.g. operational recovery time, liquidity buffers, capital adequacy).
Demonstrate how tolerance supports value creation through risk, not just limits exposure.
Report tolerance outcomes, including avoided losses or improved decision-making, to boards and stakeholders.
Use post-incident reviews to dynamically recalibrate tolerance levels when market or regulatory conditions change.
Integrating Risk Tolerance with Risk Appetite and Capacity
Risk tolerance is the operational bridge between high-level risk appetite and day-to-day decision-making. Appetite defines intent. Capacity defines the outer boundary of what the organisation can absorb. Tolerance sits in the middle, translating appetite into actionable thresholds that ensure risk-taking is both deliberate and sustainable.
When tolerance is integrated with appetite and capacity, it stops being an isolated control exercise. It becomes part of the enterprise risk governance framework, enabling boards and executives to make informed risk decisions that are anchored in strategy, aligned to risk oversight requirements, and resilient in the face of emerging threats.
1. Position tolerance as the translation of appetite into practical thresholds
Risk appetite statements are too often high-level aspirations that lack operational traction. To have impact, they must be converted into clear, enforceable risk thresholds.
How to implement:
Break down appetite into measurable limits for each risk type, such as credit, operational, or compliance risk.
Define thresholds at a level that links directly to decision-making, such as maximum acceptable change-related incidents or predefined financial loss limits.
Embed these thresholds into risk dashboards, risk committee packs, and key governance forums to ensure ongoing oversight.
Example: If an organisation’s appetite is to “accept moderate technology risk to enable faster digital transformation,” tolerance might translate into a threshold of “no more than two high-severity change-related incidents per quarter,” with escalation to the board if breached.
2. Connect tolerance to financial, operational, and cultural capacity
Tolerance must reflect not only what is strategically desirable but also what is operationally and culturally sustainable. Risk capacity sets the ultimate boundary for exposure, but effective governance requires setting tolerance deliberately below this limit.
How to implement:
Assess financial capacity (e.g., capital or liquidity buffers) to determine the maximum shock the organisation could technically withstand.
Factor in operational constraints, such as staffing, technology resilience, and third-party dependencies.
Consider cultural readiness and leadership accountability. A risk-aware culture may support more flexible tolerance, while risk-averse cultures may necessitate tighter boundaries.
Example: A firm may have the financial capacity to absorb £20M in operational losses, but given its risk-averse culture and focus on customer trust, it sets tolerance at £5M, supported by stricter escalation pathways and governance oversight.
3. Resolve tensions between group-level tolerance and business-unit realities
Enterprise risk management (ERM) requires reconciling group-level appetite and tolerance with the specific risk profiles of business units.
How to implement:
Cascade tolerance from group to business unit level while accounting for local market dynamics, regulatory requirements, and operational realities.
Establish governance forums for resolving conflicts between enterprise risk oversight and unit-specific risk-taking.
Monitor cumulative risk exposure to ensure that business-unit deviations do not breach enterprise-wide appetite.
Example: A global payments provider may set an enterprise-wide tolerance for fraud losses. However, higher-risk markets may have tighter thresholds for fraud detection to ensure the group’s consolidated risk exposure remains within capacity.
4. Recalibrate tolerance following major incidents or shifts in the risk environment
Risk tolerance is not static. It must evolve with the organisation’s risk profile, regulatory expectations, and competitive landscape.
How to implement:
Review tolerance levels regularly in risk committees, particularly following incidents, audits, or regulatory feedback.
Adjust thresholds in response to external changes, such as new regulations or emerging threats like cyberattacks or third-party concentration risks.
Integrate scenario analysis to test whether current tolerance levels remain viable under stress conditions.
Example: After a major third-party data breach in the industry, a financial services firm might tighten its vendor risk tolerance, requiring enhanced due diligence and board approval for new outsourcing arrangements.
Execution and Change Enablement
Risk tolerance must be embedded in the way organisations execute strategy and manage change. When tolerance remains a static policy or a compliance formality, it fails to influence real decisions. By contrast, when it is operationalised and woven into transformation governance, risk oversight, and day-to-day execution, tolerance becomes a dynamic tool that drives confidence and control in complex environments.
1. Translate tolerance into business-relevant language
Tolerance statements are often written in technical or risk-specific language that is disconnected from the way business leaders make decisions. To be effective, tolerance must be articulated in a way that resonates across the organisation.
How to implement:
Convert abstract thresholds into clear business terms (e.g., “no more than 2% customer impact per system change” instead of “critical incident tolerance level”).
Link tolerance explicitly to enterprise risk management (ERM) and risk decision-making processes.
Integrate tolerance into board and executive reporting using language aligned with strategy, operational goals, and performance outcomes.
Example: Rather than presenting a tolerance breach as a “KRI variance,” frame it for executives as “a deviation from the customer experience threshold that requires immediate review.”
2. Train leaders and teams to apply tolerance in real-world decisions
Risk tolerance is only as effective as the people applying it. Without proper training and reinforcement, it risks becoming a static control instead of an operational capability.
How to implement:
Develop targeted training for executives, risk committees, and front-line managers to ensure they understand how to use tolerance thresholds in practice.
Embed tolerance discussions in leadership forums, ensuring leaders model the right risk behaviours and reinforce tone from the top.
Use case studies and simulations to help teams practice escalation pathways and decision-making under defined tolerance thresholds.
Example: A transformation program lead is trained to recognise when project delivery delays push a program outside its risk tolerance, triggering mandatory escalation to the change governance committee.
3. Embed tolerance into transformation programs and risk assessments
Change risk management is one of the areas where tolerance has the most practical value. By linking tolerance to transformation governance, organisations prevent risk blind spots during critical change initiatives.
How to implement:
Require risk tolerance assessments as part of all major change initiatives and transformation programs.
Integrate tolerance thresholds into program risk dashboards, ensuring that risk governance framework oversight extends to change delivery.
Ensure risk committees regularly review tolerance breaches related to change risk management.
Example: A financial institution implementing a core banking platform sets a tolerance threshold for “no critical outages during migration.” This threshold is tracked at the program governance level and linked to automated monitoring for real-time reporting.
4. Automate monitoring and escalation where feasible
Manual risk monitoring is resource-intensive and prone to delays. By leveraging technology and risk analytics, organisations can automate key elements of risk tolerance oversight, improving speed and accuracy.
How to implement:
Deploy automated monitoring tools for key risk indicators (KRIs) to detect breaches in real-time.
Integrate automated risk escalation workflows with enterprise risk governance platforms, ensuring timely notification to the appropriate decision-makers.
Use predictive risk management techniques to anticipate tolerance breaches before they occur.
Example: If automated monitoring detects a spike in failed transactions above a predefined tolerance threshold, an escalation alert is automatically sent to both operations leadership and the risk oversight function.
5. Establish feedback loops for continuous improvement
Tolerance frameworks cannot be static. By capturing lessons from breaches and near-misses, organisations can refine thresholds and strengthen their risk execution framework over time.
How to implement:
Conduct post-incident reviews to assess why tolerance was breached and what adjustments are required.
Feed lessons into transformation risk governance processes, ensuring new initiatives benefit from previous insights.
Regularly recalibrate tolerance thresholds based on operational performance, risk trends, and regulatory expectations.
Example:Following a series of change-related incidents, an organisation tightens its tolerance thresholds for technology deployment risk and implements new training for project managers on early escalation.
Common Objections and Misconceptions About Risk Tolerance
While risk tolerance is emerging as a core governance tool, some leaders remain skeptical. These objections are not only predictable—they’re valuable because they highlight where many organisations still get risk tolerance wrong.
“Risk tolerance is too rigid for a dynamic business environment.”
Risk tolerance is not a fixed boundary. When designed well, it adapts to changing conditions through early-warning indicators, scenario testing, and periodic recalibration. The goal is not to constrain decision-making but to make risk-taking more transparent and defensible.
“It creates unnecessary complexity and paperwork.”
Overly complex risk governance frameworks fail because they don’t get used. Effective risk tolerance frameworks simplify decisions by defining clear thresholds, escalation rules, and ownership. Instead of adding bureaucracy, they remove ambiguity and reduce decision paralysis.
“Cultural change is unrealistic or too slow.”
Culture does not need to be perfect for risk tolerance to work. Even incremental shifts—like visible leadership support for escalation, documented breach responses, and consistent messaging—can reinforce the right behaviours. Cultural maturity grows through consistent application, not as a prerequisite.
“Tolerance just duplicates risk appetite.”
Risk appetite is directional—it sets ambition. Risk tolerance is operational—it defines measurable limits and actionable triggers that convert ambition into controlled execution. The two are complementary, not interchangeable. Appetite tells you “how far”; tolerance shows you “when to act.”
“It won’t hold up in practice.”
Tolerance governance breaks down when breaches are ignored or downplayed. Strong leadership sponsorship, formal escalation protocols, and transparent reporting ensure that breaches are not only tracked but trigger meaningful action. The discipline of escalation is what builds trust in the framework.
“Measurement is too subjective.”
Not all risks can be measured with financial precision. But tolerance does not require perfect quantification. A mix of quantitative indicators (KRIs, loss thresholds) and qualitative measures (near-miss reporting, behavioural signals) creates a practical view that informs decision-making without false precision.
Conclusion
Risk tolerance creates a clear, actionable framework that unites strategy, governance, culture, and execution. When fully embedded, it guides decision-making, strengthens accountability, and ensures that risk-taking is aligned with the organisation’s objectives.
It integrates with risk appetite, connects to capacity, and provides leaders with forward-looking insights to act with confidence. It reinforces leadership behaviours, fosters a strong risk culture, and supports transformation by linking risk governance to measurable outcomes.
Risk tolerance enables organisations to lead with clarity, make informed decisions at pace, and build resilience that inspires confidence among boards, executives, regulators, and stakeholders. It is a strategic capability that turns governance into a driver of sustainable performance and long-term value creation.
The question for you is:
“How do we use tolerance to lead, decide, and adapt faster than our risks evolve?”
About the Author: Julien Haye
Managing Director of Aevitium LTD and former Chief Risk Officer with over 26 years of experience in global financial services and non-profit organisations. Known for his pragmatic, people-first approach, Julien specialises in transforming risk and compliance into strategic enablers. He is the author of The Risk Within: Cultivating Psychological Safety for Strategic Decision-Making and hosts the RiskMasters podcast, where he shares insights from risk leaders and change makers.