Definition:
Stated risk tolerance is the level of risk an organization publicly declares as acceptable in its policies, risk criteria, and design standards. This is the benchmark used to guide safety decisions, allocate resources, and justify selections like Safety Integrity Level (SIL) targets. It is the proverbial “line in the sand”
The embodiment of the stated risk tolerance is the calibrated risk matrix.
Other possible names: corporate risk tolerance, risk matrix threshold, target risk level
Key Points:
- Codified in formal policies, corporate risk matrices, and design requirements.
- Used during hazard and risk assessment to determine need for protective layers or safety systems.
- Serves as the reference standard during audits, incident investigations, and regulatory reviews.
- Basis of SIL determination
- Risk above this limit requires additional safeguards
- Equal to or lower than tolerable risk
Example:
A company’s process safety policy specifies that no single fatality scenario may have a likelihood greater than 1 in 100,000 years, setting this as its maximum stated risk tolerance when designing safeguards. This is documented in the calibrated risk matrix.
The exact same facility in India has a different stated risk tolerance based on their corporate and cultural differences of 1 fatality every 10,000 years.
See also: tolerable risk, calibrated risk matrix