Identifying and evaluating risk is a complex process that involves several crucial steps. First, it requires us to identify potential hazards and consider who might be affected by them. Then, once we’ve done that, we must evaluate the risk by considering existing control measures and estimating the likelihood and severity of an incident. This step is critical because it helps us determine the ‘residual risk’ that remains after control measures have been implemented.
But what do we do with this figure? We need to make a judgment call. Is the residual risk acceptable or not? To illustrate this concept, let’s consider an example – crossing a road. The risk may be too high to cross if the traffic is heavy and fast-moving. However, if there’s a significant benefit to crossing immediately, such as a medical emergency, you might be willing to tolerate the risk.
This concept of “tolerability” or “acceptability” of risk is not straightforward. What’s acceptable to one organisation may not be acceptable to another. It all depends on the context. Factors like the benefit to be gained and the consequences of not taking the risk are relevant. Ultimately, it’s up to the organisation to decide what level of risk is acceptable based on their attitude towards risk.
Therefore, the decision-making process related to risk involves considering all the relevant factors and taking a holistic approach to evaluating the residual risk. Once the level of residual risk has been determined, the organisation must make a judgment call on whether the risk is acceptable. If not, they must implement additional control measures to reduce the risk to an acceptable level. The key is to balance the benefits of taking a risk and the potential consequences of not doing so.
