Risk Management Reports

October, 2000
Volume 27, No. 10
Risk Communication Again

Is it important to involve our stakeholders in the process of assessing and responding to risk as we make decisions? I’ve already urged that this become a key part of the process. Others disagree. A diametrically opposed comment came from Jack Dowie, in an article in issue 2-2000 of Risk Management: An International Journal: “Better risk communication has no role to play in improved decision making.” That bald assertion forced me to review my own position.

Dowie’s point, as I read him, is that “decision analysis involves raising the analysis-to-intuition ratio in judgement and decision making significantly above that which characterises every-day politico-scientific, professional and lay discourses.” Since “most people’s judgement and decision-making” are corrupted by biases, preconceptions, and flawed analyses, bringing them into the equation means, too often, “that ‘risk’ (is) being used strategically, consciously or unconsciously, to prevent (my emphasis) discussion and debate being raised to the higher ratio that transparency require(s), while giving the impression that it was becoming more ‘scientific’.”

I acknowledge his point. He seeks a higher and purer approach to decisions. Listening to many other voices easily distorts and delays decisions, but since these very decisions affect many others, don’t we have a responsibility to bring them into the process, however messy it may become? Can we really stand above the throng, like all-knowing seers? Democracy is not always efficient, but it is the best system yet devised.

Luckily I found some support for my position in four recent publications. The first is from academia. John Shortreed, head of the Institute for Risk Research, at the University of Waterloo, in Canada, prepared, with two associates, L. Craig and S McColl, a “Draft Benchmark Framework for Risk Management,” for NERAM, the Network for Environmental Risk Assessment and Management. In it the authors summarize the “guiding principles” for our discipline, drawn from Australian, New Zealand, Canadian and US sources. One of those principles is: “explicit consideration of stakeholder views of the acceptability of the risk management options through early and ongoing involvement in the decision process.” (my emphasis) They go on to describe the strategic, tactical and operational risks that face all decision-makers, suggesting that one of the key goals in building and maintaining the “trust of stakeholders” in the organization is their “acceptance of operations, programs, decision, and analyses,” their “satisfaction with risk communication efforts,” and “their acceptance of residual risk.”

They call for a continuing “two-way dialogue” with stakeholders: “The organization should have a process in place for identifying, communicating and consulting

with stakeholders. Stakeholders can include decision-makers, individuals who are or who perceive themselves to be directly affected by a decision or activity, individuals inside the organization, partners in the decision, regulators and other government organizations that have authority over activities, politicians, non-government organizations, the media and other interested individuals and groups. The stakeholder consultation process should be continuous and included as an integral part of risk communication.”

Is this over-reach? I don’t think so. We acknowledge that an organization’s public reputation is its most important asset in our modern media-inundated world. This means that communicating intelligently with these groups must be the key to building and maintaining public confidence. The still-unwinding fiasco of the Firestone-Bridgestone tires and their use on Ford vehicles is a case of an early failure of reasonable communication with customers and public regulators. The continuing news stories and recriminations damage the reputation of two global corporations. Risk communication suggests that we involve consumer and groups and regulators far earlier in the process of making operational decisions involving risk.

The other three supporting documents come from the Conference Board of Canada. The first is Members’ Briefing 279-00, “A Time to Speak - Strategic Leadership for Effective Corporate Communications.” It re-emphasizes the “six Rs of corporate communications - having the right source provide the right information to the right audience, at the right time, in the right place, using the right dissemination method.” Karen Thiessen’s “Don’t Gamble with Goodwill: The Value of Effectively Communicating Risks” (Members’ Briefing 284-00) was reviewed in RMR in the June 2000 issue, and she has followed that with Case Studies 290-00, “Ambassadors of Goodwill: Key Insights of Some Well-Known Case Studies in Risk and Crisis Communication.” She cites three Canadian organizations that have successfully integrated risk communications in their risk management programs.

Together, these papers provide a succinct summary of developing principles and practices in risk communication. Yes, an active process with all stakeholders opens a can of worms, but those very worms should be considered the bait with which we attract and keep public confidence.

For more information on the NERAM paper, contact John Shortreed at shortree@uwaterloo.ca.

For the CBC papers, contact Karen Thiessen at thiessen@conferenceboard.ca

The (risk management) framework must be easily understood by risk managers, stakeholders and other members of the public. Extensive documentation of scope, methods, and decisions is needed.

J. H. Shortreed, L. Craig and S. McColl, Draft Benchmark Framework for Risk Management, May 19, 2000

Copyright H. Felix Kloman and Seawrack Press, Inc.

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