What is ‘risk’?
IRGC has adopted a broad definition of risk, relevant to a wide range of risks, especially when knowledge about them is poor and their management not routine or straightforward: “Risk refers to uncertainty about the consequences of an activity or event with respect to something that humans value”. This is consistent with ISO 31000:2018 where risk is “the effect of uncertainty on objectives”, and risk management is defined as “coordinated activities to direct and control an organization with regard to risk”. Information about severity and probability, or impact, exposure, vulnerability and consequences serves to characterise the risk.
Risk arise with change and is often accompanied by opportunities, benefits and tradeoffs. Better risk governance implies enabling societies to benefit from change while minimising the negative consequences of the associated risks. The governance of global and systemic risks requires international coordination and inclusion of governments, industries, scientific institutions and civil society.
Governance refers to the actions, processes, traditions and institutions by which authority is exercised and decisions are taken and implemented. Risk governance applies the principles of good governance to the identification, assessment, management and communication of risks.
IRGC develops concepts and tools for evidence-based risk governance. It addresses key questions such as:
- How to improve the contribution of science to risk-related policymaking?
- Do organisations and people at risk understand the hazard and its consequences?
- Do they have the capacity to manage the risk and the resilience to cope with unexpected severe consequences?
- What are the secondary impacts of a risk and how is it managed?
- What societal, environmental and economic values affect our willingness to accept the risk?
- To what extent should a precautionary approach be used to address uncertainty and ambiguity?
- How best should one balance an inclusive approach to decision-making with the need to reach a decision?
The challenges of risk governance in today’s world
Today’s globalised world is characterised by increasing interconnectedness and fast-paced technological change. While this creates new opportunities, this can also increase vulnerabilities and create new risks. In particular, technology-related systemic risks can have effects on a much larger scale, and sometimes over a longer timespan, than conventional risks.
Because the evolution of governance mechanisms occurs much more slowly than the processes driving technological and social change, there are reasons for concerns about whether existing governance mechanisms are appropriate to efficiently deal with risks such as those that come with climate change, biodiversity loss and artificial intelligence; or to resolve trade-offs between diverse, sometimes conflicting, needs and interests (as often arise with new technologies developed for specific purposes, potentially overlooking downsides).