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RISK MANAGEMENT
Assessment of the entity’s stakeholders risk
tolerance and its balance with opportunity
• Good risk management allows businesses to exploit
opportunities for future growth while protecting the
value already created.
• By aligning risk management activity to what the
shareholders consider vital to the success of the
business, the shareholders are assured that what they
value is protected.
• This would occur in the following four stages:
• Establish what shareholders value about the company.
• Identify the risks around the key shareholder value drivers.
• Determine the preferred treatment for the risk.
• Communicate risk treatments to shareholders.
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