Risk assessment must consider crisis management.
Risk assessment is a set of processes that make it possible to identify situations that may cause harm . In this way, they allow for hazard control and the taking of measures to prevent and minimise their possible consequences.
Risk analysis is often associated with accident prevention in the workplace (i.e., occupational risk ). However, the concept can also be applied to market risk , environmental risk , legal risk , and other types of threats.
Main features
To begin to examine the concept, it is important to pay attention to the terms that comprise it. An assessment is an estimate or an evaluation; a risk , meanwhile, is a contingency that could cause damage.
When carrying out a risk assessment, therefore, circumstances or factors that are potentially harmful to physical or material integrity are examined. Based on these assessments, measures can be taken to reduce the possibility of damage occurring and to mitigate its effects.
It is important to note that risk assessment is a systematic practice aimed at improving safety . It must be guided by risk management experts who have the technical and scientific knowledge to indicate how to proceed.
Another issue to consider is that, in many cases, risk assessment is mandatory to comply with legal provisions . However, there are supervisions and audits that go beyond regulatory compliance and are intended to mitigate potential serious consequences.
Strategic planning must include risk assessment.
Types of risk assessment
As we have already indicated, there are various types of risk assessment. If we think about safety at work, a specific or legally mandated assessment is one ordered by particular regulations or standards. In these cases, the risks come from the equipment, installations and/or materials used.
A general assessment , on the other hand, is a broad estimate of the hazards existing in the workplace. These procedures aim at identifying and assessing threats, which are classified according to risk levels.
Risk assessment for which there are no specific laws is another classification of these processes. It is based on technical guidelines or guidelines that, for example, warn about the levels of exposure to a substance that should not be exceeded.
Other types of risk assessment are associated with the nature of the threat or the scope of its development. Of course, when a financial risk is assessed based on an analysis of possible scenarios, other resources and methodologies come into play than if an identification of dangers linked to cybersecurity is carried out to estimate a technological risk . In turn, if a public health risk is examined through an environmental impact assessment, other issues will be observed and different techniques will be applied.
Risk assessment is very important in the insurance sector.
Step by step
Taking into account what has been mentioned about the variety of types of risk assessment and considering the multiple contexts where these actions can be carried out, it is possible to list a series of steps that are usually followed in these processes:
- Risk identification : The first step is, of course, to identify the threats. These may be possible causes of work-related accidents, biological risks, natural disasters, etc.
- Determining potential damage and casualties : Consideration must be given to who may be injured and what objects may be affected.
- Risk assessment : The probability of occurrence and the possible severity of the effects must be measured.
- Risk control : The implementation of measures to reduce the likelihood of a threat occurring and to mitigate the consequences. In addition to addressing risk mitigation, contingency plans are required for emergency situations.
- Documentation of the evaluation : It is very important to record what was detected and the decisions that were adopted based on the work that was carried out.
- Review and update : The assessment should be reviewed periodically to determine whether new threats have emerged and whether control measures have been properly implemented. Procedures should be updated when necessary.
Risk assessment examples
Let's take the case of a hotel's occupational safety officer. This expert draws up a risk matrix to classify risks according to probability (from very unlikely to very likely) and the severity of the consequences (from insignificant injuries to death). Taking into account the risk assessment, he implements various control measures. Prevention ranges from the provision of personal protective equipment (for those working in the kitchen and for those who clean the rooms) to facility control devices (carbon monoxide detector, fire alarm, etc.).
If we think about an analysis of the threats faced by those working in a hospital , the health risk will surely be noted. It is essential that doctors and nurses have gloves and face masks, as well as that the collection and disposal of pathological waste is carried out in accordance with regulations.
Other examples of risk assessment can be found in the financial sector , with a very different approach. The concept of credit risk refers to the probability that an entity will suffer losses due to a debtor's non-payment. Thus, risk auditing aims to detect indicators that reveal how payment behaviour will be. This is key for banks that grant loans and companies that sell on credit.