Governance Structure

The formal arrangement of bodies, roles, and relationships that oversee and direct an organization's activities. This typically includes the board of directors, board committees (such as audit, risk, and remuneration committees), executive management team, and management committees. In RBPM, an effective governance structure provides clear escalation paths for risk issues, ensures appropriate challenge and oversight of risk-taking activities, and maintains the integrity of risk management processes. It establishes the mechanisms through which risk appetite is set, communicated, and monitored.

Governance

The processes and practices that define an organization's strategic, operating, and decision-making boundaries, as well as how decisions are made and implemented. Governance establishes clear lines of authority, accountability, and responsibility. In RBPM, governance is a critical "soft" discipline that ensures strategic objectives are pursued within appropriate risk appetite boundaries. It includes board oversight, management committees, policy frameworks, delegation authorities, and control mechanisms that collectively shape and constrain organizational behavior.