Glossary

The continuous monitoring and testing of the risk management function that provides information to relevant stakeholders regarding the health of risk management functions across the commercial cannabis business

Cannabis for sale to a consumer of legal age for personal consumption

Cannabis product sold to a consumer through a facility such as a storefront or retailer

An electric telecommunication device that enables customers to perform financial transactions, such as deposits, withdrawals, transfer funds, and accessing account information

An independent subcommittee of the board where a select number of board members are appointed for risk management oversight

An attendant working behind the counter of a cannabis location

A formal plan that ensures that the daily operations of the commercial cannabis business are not severely impacted by a disaster or significant unplanned event; Following a significant event, the business continuity plan allows the commercial cannabis business to quickly recover and become operational

The combination of decisions and actions taken to accomplish the business objective(s) is referred to as the business strategy

The chemical compounds unique to cannabis that acts upon the human body’s cannabinoids receptors

A tall upright plant with serrated hairs that produces three species of flowering plants; cannabis sativa, cannabis indica, and cannabis ruderalis

A risk framework for which risks and opportunities can be identified, analyzed, and influenced within the context of business objectives

The cannabis tourism industry

The process of managing cash, through collection and disbursement

CBD is the abbreviation for cannabidiol, one of the naturally occurring cannabinoids found in cannabis

Guiding principles adopted by an organization that describes the required ethical behavior for all personnel

Exposure to legal penalties, financial forfeiture and material loss an organization faces when it fails to act in accordance with industry laws and regulations, internal policies or prescribed best practices

Cannabis-derived extracts that contain concentrated amounts of cannabinoids and terpenes by processing the cannabis plant to remove contaminants and less desirable parts of the plant

The actions taken to minimize risk while the commercial cannabis business strives to achieve its business objectives 

A standard approach for managing risks across an organization

Establishes the risk expectation of management to assure the reduction of their risks  

The increase or decrease of risk over time  

The transfer of licensed cannabis products to the illicit cannabis market or the unlicensed use of a business process on unlicensed cannabis product

Food infused with cannabis extracts

The process of separating cannabinoids from cannabis plant material using chemical solvents or mechanical methods

The growing of cannabis according to the legal definition of hemp

Hashish, more commonly known as hash, is derived from the resin of cannabis plants

Any part of the cannabis plant, including the seeds and all derivatives, extracts, cannabinoids, isomers, acids, salts, salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol (THC) concentration at or below the jurisdiction legal definition of hemp

Holding the same type of licenses in multiple jurisdictions

Substantiated complaints from the public, recognized operational abnormalities by employees, and identified deficiencies by regulators or auditors

Illicit cannabis market risk is the exposure to legal penalties, financial forfeiture, adverse actions on a cannabis business license, or other material loss an organization faces if it is determined to be negligent or in conspiracy with illicit operators

Illicit operators are individuals or loosely associated groups operating outside of the law, primarily for personal financial gain. There is a simple hierarchical structure, a near absence of force, fear, or other coercion tactics in terms of the seller-buyer relationship, and a decentralized supply chain inconsistent with organized crime.

An estimate of the potential losses associated with an identified risk

The iterative process of providing, sharing, and obtaining organizational knowledge with relevant stakeholders

The act of incorporating either cannabis extracts or plant material into another product

The level of risk that the commercial cannabis business is exposed to without the implementation of control activities

The transfer of unlicensed cannabis products to the legal cannabis market

The set of standards, processes, and structures that provide the foundation of the company culture

The geographic area in which a political authority is recognized

Looping is the practice of evading legal cannabis purchase limits by procuring cannabis products at or below the legal limit repeatedly during a limited time period to obtain an illegal amount of cannabis product.

Establishes ownership and responsibility consistently across management 

The process of combining, compounding, extracting, blending, infusing, making and preparing cannabis products

Cannabis grown not according to the legal definition of hemp

Cannabis for sale to a medical patient for personal consumption

Cannabis products sold or transferred to medical patients through a facility such as a dispensary

Medical cannabis is when the smokable plant is prescribed while medicinal cannabis is when cannabis is used in an OTC prescription drug format

A person below the age of adult use, even if they are eligible through a medical cannabis program

The process of making illegally gained proceeds (“dirty money”) appear legal (“clean”).  

The exposure to legal penalties, financial forfeiture, and material loss an organization faces if it is found complicit in money laundering. 

The exposure to legal penalties, financial forfeiture and material loss an organization faces if it chooses unsuitable business decision(s)

A crime enterprise specifically profiting from illicit activities and goods with corrupt measures

Organized crime operators are closely associated groups operating outside the law, primarily for the organization’s financial gain. There is a well-defined hierarchical and management structure, greater operational sophistication, and they use coercive tactics to maintain their ongoing criminal activities.

The exposure to legal penalties, financial forfeiture, economic loss, and material loss an organization faces if it is perceived negligent or in conspiracy with organized crime

A unit of measurement to describe 28 grams

Placement of finished cannabis product into a container and marked for consumer sale

A board-approved document prescribing a set of principles that guide the commercial cannabis business decisions in order to achieve business objectives 

Documentation that describes how (step by step) to perform an activity and/or accomplish an objective

An activity that is performed to accomplish a risk control activity

The effectiveness of controls to mitigate risk

The risk remaining after the control activities have been applied to an inherent risk

The exposure to factors that impact the commercial cannabis business’s objective

The level of risk a business is willing to accept in order to attain business objectives

A segment of risk that is material enough to have its own risk drivers

Process of evaluating risks that could affect the achievement of business objectives with a focus on the likelihood and magnitude of impact

The system of values, actions, and approach by the organization for addressing risk

The set of critical factors that significantly influences where a risk issue will be present

Example of a risk to which a commercial cannabis businesses is commonly exposed

The process of identifying, assessing, prioritizing, and controlling risks to minimize the impact of threats and maximize opportunities

The set of risk related policies and procedures delegated to the employee

Action that is taken by a business to reduce the risk a level that is within the risk appetites

A qualified person, appointed by the board, with the appropriate responsibility and authority to oversee the implementation of the risk program

Documentation of the risks involved in performing your business activities. Because any activity can have some risk involved, commercial cannabis businesses create a risk policy as a way of defining those risks. It should set the companies expectations of risks to be managed, who is ultimately responsible for management of the risks, and to what outcome.

The outline of the entire risk landscape that is the catalogue, types, and potential effects of risks to which a commercial cannabis business is exposed

A structured process to identify potential risks and the development and implementation of a strategy for minimizing or mitigating the impact of these risks

A management committee formed by the Board of Directors or equivalent committee

Integration of business objectives with risk management techniques

The specific amount of risk an organization is willing to accept from its defined risk appetite per business objectives

The principal reason for the occurrence of a problem

Two ore more individuals who are responsible for completing different parts of a task within the same process, so no individual can complete the entire process without the involvement of other individuals

The loss of inventory that can be attributed to factors such as employee theft, customer theft, vendor fraud, damage in transit or in-store, or counting or recording errors

Any individual or entity that has an interest in the organization or may be affected by the organization’s actions; including investors, employees, suppliers and vendors, and customers

A person who purchases cannabis on behalf of another

Structuring means breaking up a large cash transaction into small cash transactions to disguise the true amount of cash involved in the transaction.

The network of all the individuals, organizations, resources, activities and technology involved in the creation and sale of a product, from the delivery of source materials from the supplier to the manufacturer, through to its eventual delivery to the end-user 

The exposure to reputational risk and material loss an organization faces if it is associated with a negative supply chain event

Aromatic oils that give cannabis distinctive flavors

Delta-9-tetrahydrocannabinol, more commonly known as THC, one of the naturally occurring cannabinoids found in cannabis

A cannabis extract in liquid form

A cannabis product where the cannabis active properties are extracted and combined into skin products, such as lotion

The laws and regulations that are implemented to enable regulators to monitor the production of cannabis from the initial state to a desired state before allowing non-licensed customer access

The development of skills pertaining to the application of and knowledge on risk policies and practices relevant to the board, employee, and stakeholder’s role or position

The temporary storage and transfer of cannabis or cannabis derivatives from one physical location to another by means of a vehicle, ship, or aircraft

A company or person offering a product or service for sale

Holding multiple types of licenses in the same jurisdiction