ABSTRACT
In our description and application of the RARA Model so far, we have focused on risk thresholds as the directly measurable articulation of risk appetite and risk attitude, that is, ‘how much risk will we take in this situation?’ In Chapter 5 we used practical examples to show that if risk thresholds are to be useful in guiding decision-making, then they need to be informed by an understanding of the influences on risk appetite (the things that affect the tendency of the group or individual to take risk) and the influences on risk attitude (factors affecting perception of risk). We used four worked examples across the three scenarios – Unmanaged, Constrained and Informed – to illustrate how each element of the RARA Model works as part of a coherent whole.
