Risk

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Risk

Risk is a measure for the expectation of undesirable outcome has attribute::impact to realise. This expectation concerns both the has attribute::likelihood and magnitude of the undesired outcome. Quantified levels of risk are often used to enable an assessment of risk in order to establish if they fall within acceptable limits or to determine which risks pose the highest has attribute::threat.

Definitions

There is no one, universally accepted definition for risk. A prominent definition of risk is provided in the ISO 31000:2009 risk management standard [1], where risk is defined as the ‘effect of uncertainty on objectives’ and both positive and negative effects are included. As this definition is of a high conceptual level and can be counter-intuitive, for the purpose of this wiki, the definition as mentioned above will be used.

Objective and subjective risk

There are two aspects of the determination of risks: the risks that are in fact present (objective risks), and the risks as they are perceived (subjective risks). One would expect the two to be very similar, but studies have shown they can (and often do) differ quite a bit.

About subjective risk

Results from urban planning decisions can influence citizens’ perception of risk including the distraction of risk perception for more objective risk levels. Conversely, citizens’ risk perception can result in societal demands on urban planning. Several specific aspects as addressed in the following are worth consideration in strategic urban planning. These aspects among others include indicators for citizens’ subjective perception of criticality of infrastructure and need to protect it, including by appropriate urban planning measures. Conversely, infrastructure that results from urban planning may also influence subjective assessment of its criticality and contribution to security or susceptibility to natural or anthropogenic (“man made”) risk.

Risk perception is strongly influenced by various subjective factors that drag it from objective risk figures. Factors such as overconfidence, loss aversion, individual experience, temporal factors, capacity of remembering, level of information and knowledge, public discourse, stigmatization, cultural factors, orientation of values, confidence in institutions, etc.[2]

This is relevant to urban planners since they have some means to direct the perceived security or at the very least has means to predict it and account for it in planning. Addressing of risk in planning should be coherent with societal risk perception and views [3]. Adequate risk management and public communication can help urban planners to prevent negative effects from public risk perception, or misperception, and related public demands on or acceptance of urban design. However, effects of urban planning decisions can also distract citizens’ risk perception from more objective risk levels.

To do so, the complexity of individual and social mechanisms of risk perception has to be appreciated.[4] Humans usually do not fear statistically highly ranked threats to life and health (such as car accidents, food poisoning, cancer and others), whereas they are disproportionately wary of spectacular hazards, even if related vulnerabilities are low.

About objective risk

Although terminology may vary, two widely accepted elements in the definition of risk are the inclusion of likelihood and magnitude and to a lesser extent, the fact that to arrive at a measure of risk, the two should be multiplied. A simple, but widely used definition of risk is therefore

Risk = Likelihood of event realizing X Impact (expected loss in case the accident realizes).

Many variations exist, for example by distinguishing between the likelihood of a threat realizing (also called probability) and the likelihood that that threat will affect an object (has attribute::vulnerability). An example would be storm damage: the probability would reflect the likelihood of a storm at the object, the vulnerability would reflect the likelihood that this storm would cause damage and the impact would reflect the extent of damage that would occur if the storm would cause damage. The quantified risk formula associated with this definition is

Risk = Likelihood of event realizing X vulnerability (probability of realized event impacting object) X Impact (expected loss in case the accident realizes and impacting object).

The estimation of likelihood in security

The use of probability relies on the ability to make reliable predictions. This is most often based on the analysis of past occurrences and identification of trends. When determining risk in the field of threats related to is caused by::human intent, the use of trend analysis to determine likelihood is criticised[5] for threats actively seeking harm (for example terrorism). This is due to the fact that

  • these events occur relatively infrequently, making the recognition of trends difficult;
  • in contrast to for instance natural threats, the results of past events does influence the likelihood of future events: potential perpetrators will actively seek ‘the weakest link’. This means that the predicting value of trends in past occurrences is in doubt.

A way to overcome these problems is to substitute has attribute::attractivity for probability and has attribute::conceivability for vulnerability. In this way, assumptions about historical data predicting future events can be avoided.

Uses of risk assessment

t.b.e.

Sources of risk

One way to typify types of risk, is by their causes. A cause for risk is called a is caused by::threat. Threats can be classified into has attribute::safety threats, consisting of natural threats, is caused by::human failure, is caused by::technical failure, is caused by::failure of critical services and has attribute::security threats which are due to is caused by::human intent.

Related subjects

Footnotes and references

  1. ↑ [See: http://en.wikipedia.org/wiki/ISO_31000]
  2. ↑ cf. V. T. Covello et. al.: Risk Communication, the West Nile Virus Epidemic, and Bioterrorism: Responding to the Communication Challenges Posed by the Intentional or Unintentional Release of a Pathogen in an Urban Setting. Journal of Urban Health: Bulletin of the New York Academy of Medicine, Volume 78, No. 2, 2001, p. 382-391. OECD: OECD Reviews of Risk Management Policies. Future Global Shocks. Improving Risk Governance. Preliminary Version. OECD Publishing, 2011; D. Proske: Katalog Risiken. Risiken und ihre Darstellung. 1. Auflage. Eigenverlag: Dresden, 2004, p.167-174. Online: http://www.qucosa.de/fileadmin/data/qucosa/documents/71/1218786958574-1736.pdf. P. Slovic et al.: Facts and Fears: Societal Perception of Risk. In: K.B. Monroe/A. Abor (eds.): Advances In Consumer Research. Volume 08, Association For Consumer Research, 1981, p. 497-502. Online: http://www.acrwebsite.org/volumes/display.asp?id=5844. H. Sterr et al.: Risikomanagement im Küstenschutz in Norddeutschland. In: C. Felgentreff/T. Glade: Naturrisiken und Sozialkatastrophen. Berlin Heidelberg: Springer, 2008, p. 345-346. M. Zwick/O. Renn: Risikokonzepte jenseits von Eintrittswahrscheinlichkeit und Schadenserwartung. In: C. Felgentreff/T. Glade: Naturrisiken und Sozialkatastrophen. Berlin Heidelberg: Springer, 2008, p. 85-95.
  3. ↑ ECD: OECD Reviews of Risk Management Policies. Future Global Shocks. Improving Risk Governance. Preliminary Version. OECD Publishing, 2011. OECD (2003): Emerging Risks in the 21st Century. An Agenda for Action. OECD Publication Service: Paris. Retrieved from: http://www.unisdr.org/eng/library/Literature/7754.pdf [last access: 2011 07 28]: 54-56.
  4. ↑ D. P. Coppola: Introduction to International Disaster Management. Oxford: Butterworth-Heinemann, 2007, p. 162.
  5. ↑ Add reference

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