Control Environment

The set of standards, processes, and structures that provide the foundation for carrying out internal control throughout an organization. It encompasses the organization's integrity, ethical values, management philosophy, board oversight, accountability structures, and commitment to competence. In RBPM, the control environment is a critical component of risk management, establishing the tone for risk awareness and the importance of operating within appetite. A strong control environment helps prevent excessive risk-taking while enabling appropriate risk-taking in pursuit of strategic objectives.