Is risk assessment important?
Risk assessment (relative rating of risks) is included in almost every environmental and safety risk register, but what is its purpose and how important is it?
In its simplest application, it is the means of prioritising the work of risk control. In risk management, the “assessment” usually plays only a minor role. Hazard identification and development of risk controls dominate. Monitoring and review are also important, but are often overlooked.
In this post, I will explore some of the difficulties in risk assessment and then try to put them in perspective.
How is risk calculated?
Most commonly, risk assessment is calculated as the product of “worst-case consequence” and the “likelihood” of that consequence. For safety, another factor, “frequency of exposure”, is sometimes included.
The estimation of “worst-case consequence” is usually not too difficult, though it must be admitted that most safety incidents could cause permanent disablement or death in extreme cases, so some sensible judgement is needed. For environmental incidents, the consequence for the environment is difficult or impossible to estimate, so many use measures such as legal noncompliance, possible fines, PR damage and cost of remediation.
The estimation of “likelihood” of that consequence is much more problematic. What is the likelihood of an employee being run over and killed by a delivery truck? Well, unless it is a regular occurrence, then we have no data to work with and we resort to pure guesswork. Is this useful?
Estimating “likelihood” is especially difficult when calculating “inherent risk”, ie. the risk prior to implementation of any controls. What does “no controls” mean anyway? We can picture a piece of machinery without any guarding, but do we also assume the operator has received no training? Do we assume he/she has no common sense? Where do we stop? Calculation of inherent risk is of little value in my opinion.
And one more problem. A risk rating is traditionally based on the worst-case consequence and its corresponding likelihood. But it may be that a lesser consequence and its corresponding likelihood will give a greater risk rating, so we may be understating the risk by using worst-case consequence.
My advice is not to get too hung-up about these issues. Remember that the reason for calculating risk assessments is simply to prioritise. I believe one can almost do that intuitively once the hazards have been identified. Please note that Safe Work Australia advise that risk assessment is unnecessary if you already know the risk and how to control it, and published codes of practice are a great source of risk controls.