Who in an organization determines the overall risk profile?

The overall risk profile of an organization is determined by the risk owner and the player, as they have the responsibility for identifying, assessing, and prioritizing risks based on the organizational objectives and risk appetite. The risk owner typically has the authority and accountability for managing specific risks, while the player (often part of the broader risk management team) supports this process by providing insights and contributing to the overall risk assessment activities.

This collective approach allows for a more comprehensive understanding of risk across various aspects of the organization, ensuring that all relevant factors are considered. The risk owner and player work collaboratively to evaluate the potential impact of risks on business operations, compliance, and overall strategic goals, thus shaping a detailed risk profile that informs decision-making at all levels of the organization.

In contrast, while a risk manager might play a pivotal role in the risk management framework, they often act within the guidelines set forth by the risk owner and might lack the authority to define the organization’s overall risk profile themselves. A compliance officer focuses more on adhering to regulatory requirements and may not encompass the full scope of organizational risk. Similarly, the IT administrator's role is typically more technical and operational, without the broader strategic oversight required to define the overall risk profile.