The Financial Stability Board (FSB) has published two papers designed to assist supervisors in enhancing risk management practices at financial institutions:

• Principles for an effective risk appetite framework. Following comments received to an earlier consultation the principles have been revised. Respondents were generally supportive of the overall direction of the draft principles, however, they sought greater clarity on the extent to which a financial institution’s risk appetite should be cascaded to individual legal entities and business units; and

• Guidance on supervisory interaction with financial institutions on risk culture. This guidance has been issued for consultation in order to assist supervisors in assessing the risk culture at financial institutions. The guidance follows the premise that the level of risk appetite that a financial institution sets will be influenced by its risk culture. The deadline for comments is 31 January 2014.

Copies of the principles; http://www.financialstabilityboard.org/publications/r_131118.pdf

the guidance; and the http://www.financialstabilityboard.org/publications/c_131118.pdf

related press release  http://www.financialstabilityboard.org/press/pr_131118.htm