14 - 1 Risk

The understanding of risk is a valuable asset for any environmental manager. In order to understand risk it must be defined and measured. The measurement of risk is used to obtain accurate information that will allow environmental manager to make decisions. The decisions that environmental managers make affect many entities which includes the environment, the health and safety of the general population, and even the business community.
The defenition of risk is the probability of encounteringharm or loss. Another approach to the defenition of risk would be the weighing of costs and benifits of an action. Risk is all about tradeoffs. A decision that benefits one party may come as a cost to another. An example would be the opening of a new facility. The facility would bring newjobs to the community but at the cost of pollution to the environment. Risk can be measured by taking the product of the probaility of harm and the severity of harm. This formula can calculatethe quantifiable assets that can be lost. An example includes a company assets. There are other forms of risks that are not quantifiablesuch as death and illness. Risks that are not quantifiable can be measure by other methods such as population samples and surveys. This measurement of risk is known as the liklihood of harm occurring. If the benefits of harm occurring are acceptable then the risk is taken but if the costs are great then it will not be taken. There are two different kinds of risks. The first kind of risk is background risk. Background risk is defined as a nonspecific source of risk. Incremental risk is defined as risk that result from a specific source of risk. The total risk is known as the sum of the two kinds of risks and is necessary to calculate risk.
In order to understand the concept of risk it is necessary to distinguish it from a hazard. A hazard is a source of risk that is used to desecribe how harmful a risk can be based upon its charecteristics. Variables that describe risk are indicators of danger. An example would be the four charecteristics that classifyhazardous waste which includes toxicity, ignitability, corrositivity, and reactivity.
Once risk is defined and measured, it can be managed and controlled. The management of risk depends upon types of risk and what is being protected from these risks. The determination of the presence of risk can differ from protecting the health and safety of a poulation or ecosystem to protecting business assets that may result from a disaster. The basic steps for any risk assessment include:

1) Hazard or threat identification: Determination of what poses the greatest threat.
2) Asset identification: This step determines what is at risk. This includes ecosystems, populations, and company assets.
3) Vulnerabilities Assessment: This includes identifying who is at risk how they will be exposed and to what.
4) Risk Charecterization: This includes a determination of the magnitude of risk and gathering information to develop a solution. This is also the stage that risk is prioritized. Some risk poses a greater risk than othersa and some assets are more valuable than others.
5) Risk Management: Implementing a solution that will control risk.

References
1) Chater, Ian(2007). Risk Evaluation and control: practical guidelines for risk assessmentin The Defenitive Handbook of Business Continuity Management. Hiles, Andrew pp 137 - 145
2) Milton, Quantitaive Risk Assessment, Chp 14 pp 865 - 906
3) Suter, Glen. Ecological Risk Assessment 2nd Edition., Boca Raton, FL, CRC Press (2007), Print