The Committee of Sponsoring Organizations of the Treadway Commission (COSO) released a new thought paper aimed at helping organizations better articulate, develop, and implement “risk appetite.” Enterprise Risk Management – Understanding and Communicating Risk Appetite is the latest in a series of COSO papers providing guidance on improving risk management. While helping many of our clients develop and maintain ERM programs, we have found that risk appetite is one of the most challenging pieces of the ERM puzzle. Risk appetite is the amount of risk organizations are willing to accept in pursuit of their objectives. The COSO thought paper provides example statements of risk appetite and guidance on how companies can effectively develop and document risk appetite. The concepts in the paper will be incorporated into K Financial’s ERM software in the coming months. The COSO paper is available for free at www.coso.org.