Societal considerations in implementing risk management decisions: towards improving the process.

Abstract

The risk management process can be seen as a public health activity which requires the expenditure of both public and private resources. As such, an effective risk management system must actually produce gains in public health to justify its cost. Similarly, the system should not force risk managers into decisions which are counterproductive. This requires that risk management take into consideration a variety of societal and technical factors. Among these are the actual nature of the risk involved and the risk trade-offs inherent in a management decision; the benefits associated with the risk generating activity; the practicality of various control options; and the nature of the various parties interested in the control decision. The degree of flexibility with which risk managers have to consider the various factors above depends on the risk management style under which they are constrained to operate. This is usually determined by the governing statutes or policies of the relevant regulatory agencies. These risk management styles run the gamut from zero risk approaches to risk/risk and risk/benefit balancing. Assuming that the risk manager has sufficient flexibility to produce cost effective decisions, the risk management process must still be sufficiently defined, procedurally and technically, to be accessible to interested parties. It also needs to effectively distinguish between risks which can be calculated or postulated and those which can have a practical outcome.