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The thresholds and pathways that determine when issues move between institutional levels. Well-designed escalation boundaries ensure appropriate issues reach appropriate decision-makers. Boundary failures include: boundaries too high (issues never escalate until crisis), boundaries too low (leaders overwhelmed with operational matters), and boundary confusion (unclear where to escalate what).
A compliance issue in a subsidiary should escalate to group compliance when it crosses certain thresholds. If boundaries are undefined, either everything escalates (paralysis) or nothing does (hidden risk). Functional escalation boundaries specify triggers, pathways, and response expectations.
Section 4.4: Escalation Boundaries