What is Risk?

Introduction

‘Risk’ is defined by the International Standards Organisation (ISO) 31000:2018  as “effect of uncertainty on objectives”. This is a common definition in risk literature. 

An alternative definition is “an event, situation which may influence an entity’s ability to achieve desired objectives successfully”.

Risk management can therefore be defined as the proactive control of risk in a manner that promotes positive outcomes.

For example, for a commuter with the objective of driving a car to work and arriving on time, risks could include: high traffic, a traffic accident, roadworks, and poor driving of the person trying to get to work or other commuters.

In order to manage these risks, the commuter would assess the barriers to him or her arriving on time, and come up with a proactive solution, eg. leaving home earlier or deciding to ride a bicycle or park the car and catch public transport to avoid traffic delays.

Sources

The content on this page was primarily drawn from:

• Webinar titled ‘Perspectives on Risk: Engineers, frameworks and new ways of thinking', delivered to REBOK Community on 29 May 2018 by Warren Black, Principal and Founder, Complexus