Market Risk, according to IFRS 7 "Financial Instruments: Disclosures," pertains to the risk posed to an organization's financial performance or position as a result of fluctuations in market factors, including interest rates, currency exchange rates, and equity or commodity prices. Market Risk encapsulates three major components: interest rate risk, foreign exchange risk, and price risk. Organizations are required under IFRS 7 to disclose the extent of their exposure to Market Risk, the methods they utilize to manage and measure it, and the potential impacts of unfavorable market conditions.

For instance, an entity holding financial instruments, such as bonds (prone to interest rate fluctuations) or foreign currency hedges (subject to currency exchange rate changes), needs to assess and disclose how these factors might affect their balance sheet or income statement. By adhering to IFRS 7, entities provide transparency into their Market Risk management policies and ensure stakeholders can assess the organization's risk profile effectively.

Overall, addressing Market Risk involves implementing robust risk management strategies, such as diversification of investments, utilizing derivatives for hedging purposes, or portfolio adjustments based on market expectations.