Risk tolerance operationalizes risk appetite by establishing concrete boundaries and thresholds for specific risk types. While appetite is strategic and aggregate, tolerances are tactical limits on individual risks or activities. A technology company might set risk tolerances including maximum acceptable downtime of four hours annually, no critical vulnerabilities unpatched for more than 72 hours, and customer data breach affecting no more than 0.1% of users. Tolerance levels should align with appetite, reflect regulatory requirements, and be measurable to enable monitoring and escalation when breaches occur.