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IRGC Report on Risk Governance Deficits
International Risk Governance Council
The International Risk Governance Council (IRGC) is an independent organisation based in Switzerland whose purpose is to help the understanding and governance of emerging, systemic global risks. It does this by identifying and drawing on scientific knowledge and the understanding of experts in the public and private sectors to develop fact-based recommendations on risk governance for policymakers.Innogen's Professor Joyce Tait is a member of the IRGC Scientific and Technical Council and contributed to the IRGC Report on on Risk Governance Deficits.
IRGC defines risk governance deficits as deficiencies(where elements are lacking) or failures (where actions are not taken or prove unsuccessful) in risk governance structures and processes. They hinder a fair and efficient risk governance process.
The deficits described by IRGC have recurred over time and have affected risk governance in many types of private and public organisations, and for different types of risks. While deficits may be relevant for both simple and systemic risks, in this report we focus on the latter. This is because systemic risks – defined as those risks that affect the functionality of systems upon which society depends and that have impacts beyond their geographic and sector origins – provide a greater challenge for risk governance and thus greater scope for the occurrence of deficits.
The potential consequences of risk governance deficits can be severe in terms of human life, health, the environment, technology, financial systems and the economy as well as social and political institutions. There may be a failure to trigger necessary action,which may be costly in terms of lives, property or assets lost; or the complete opposite – an over-reaction or inefficient action which is costly in terms of wasted resources. Consequences of deficits can also discourage the development of new technologies, as they can lead to a suffocation of innovation (through over-zealous regulation) or to unintended consequences (through failing to account for secondary impacts). Loss of public trust in those responsible for assessing and managing risk or an unfair (or inequitable) distribution of risks and benefits are other possible adverse outcomes.
By identifying and describing these important deficits, this report aims to help risk decision-makers in government and industry understand both the causes of deficits in risk governance processes and their capacity to aggravate the adverse impacts of a risk. With this understanding, it is hoped that risk practitioners will be able to identify and take steps to remedy significant deficits in the risk governance structures and processes in which they play a part, including those that may be found within their own organisations.