Enterprise risk & controls · Working

Risk capacity

Also called: capacity for risk

ELI5

The maximum risk an organisation can absorb without threatening viability or obligations.

Used in conversation

“Do not describe risk capacity as agreed until the operative document says so.”

Pitch context

You will see “Risk capacity” in board papers, contracts, policies, risk registers and compliance reports when the discussion reaches enterprise risk & controls.

Why it matters: In enterprise risk & controls, a loose definition can change rights, obligations, approval, disclosure or enforceability.

Caution

Meaning, enforceability and required process vary by jurisdiction and agreement; this definition is not legal advice.

Sources & evidence · 3

Direct term-level sources and supporting source families.