Enterprise Risk Management Perspectives on Risk Governance

Abstract

Most of my professional life is spent addressing issues related to the unlawful, unintended, or completely unanticipated consequences of product, production or market activities. Many of my projects involve analysis of product liability and the interaction of the various private and public institutions that regulate, resolve disputes, compensate, or punish the relevant parties. The problems can be quite limited as in a simple insurance dispute regarding coverage for a single company's environmental damage at one site, or highly complex as in the long-term forecast of liability for asbestos risks at the national level over a 50 year time horizon. My consulting experiences have taught me that risk governance, even for a ‘simple’ risk problem, not only occurs on many different levels of society, but also must contend with the widely varying interests of the participants who influence choices and outcomes. That any single framework could begin to tame the messy assessment, appraisal and management tasks of complex and/or global risk problems with the hope of offering effective guidance for governance is certainly a bold claim. Nonetheless, the IRGC risk governance framework, in my view, moves us towards that goal by its attention to integrating key insights about risk from the social, behavioural, natural, and engineering sciences. At the very least, the integrated messages of the framework are important contributions to directing a high quality analysis to support risk governance planning, perhaps even more so at non-governmental levels, where risk governance is a relatively novel concept.