Risk appetite is typically determined by which of the following organizational functions?
Risk appetite is typically determined by which of the following organizational functions?
Risk appetite refers to the amount and type of risk that an organization is willing to pursue or retain. This strategic decision is typically made by the Board of Directors since they are responsible for setting the overall strategic direction and making significant policy decisions, including the acceptance of risk levels. The Board of Directors holds the ultimate accountability for risk management in an organization and sets the tone for risk tolerance. Business units, audit and compliance, and security functions may provide important input, but they do not have the authority to determine the risk appetite.
I think this should the Board Of Director. I think they must determine the Risk Appetite of the business and NOT the Business Units. The Business Units could be compensating?
"Determined"... Can be Business Units to determine, and Board to approve. Very debating choices...
Board of directors
B Board of directors
Answer is B. The risk appetite of an organization refers to the level of risk that an organization is willing to accept to achieve its objectives. This decision is typically made by senior management or the board of directors, as they are responsible for setting the overall strategic direction and risk tolerance of the organization. Business units, audit and compliance, and security may provide input into the risk appetite decision-making process, but they do not typically have the authority to make the final decision.
Business Unit may not have the knowledge of Risk, CISO is expected to present it to Board of Directors for approval.
The risk appetite is typically determined by the Board of Directors, making option B the correct answer. The Board of Directors holds the overall responsibility for setting the strategic direction and objectives of an organization, including its risk management approach. The risk appetite represents the level of risk that an organization is willing to accept in pursuit of its objectives. It reflects the organization's tolerance for risk and guides decision-making processes regarding risk management.
Poorly phrased question, IMO. I agree with @Rufus1. It also depends on the size and type of organization.
accountable, business units, hence they determine appetite. Responsible, Board of Directors and senior leadership, They accept or reject the recommendation.
B. NIST Special Publication 800-39 (Managing Information Security Risk): This publication underscores the importance of senior leadership, including the Board, in setting the organization's risk appetite.
BOD determine