Cover Image
close this bookConducting Environmental Impact Assessment in Developing Countries (United Nations University, 1999, 375 p.)
close this folder9. Emerging developments in EIA
close this folder9.4 Environmental risk assessments
View the document9.4.1 What is environmental risk assessment?
Open this folder and view contents9.4.2 Terminology associated with ERA
View the document9.4.3 ERA and the project cycle
View the document9.4.4 ERA builds upon EIA
View the document9.4.5 Basic approach to ERA
View the document9.4.6 Characterization of risk
View the document9.4.7 Risk comparison
View the document9.4.8 Quantitative risk assessments
View the document9.4.9 Risk communication
View the document9.4.10 Risk management
Open this folder and view contents9.4.11 Guidelines for disaster management planning

9.4.10 Risk management

Risk management is the evaluation of alternative risk reduction measures and the implementation of those that appear cost-effective. It is essentially the decision-making process in which an action or a policy is developed once a risk has been determined to exist. The general process of risk management can be subdivided in three main phases.

• Phase I - risk analysis and assessment - involves the identification of hazards to people and the environment, the determination of the probability of occurrence of these hazards, and the magnitude of the events.

• Phase II - risk limits - entails defining the acceptability of the risk which can be classified as acceptable or in need of reduction.

• Phase III - risk reduction - involves the design and implementation of risk-reducing measures and controls.

Management concerns that arise because of substantial uncertainties about major environmental consequences determine the scope of detailed risk assessment. Projects are undertaken for obvious and direct benefits of economic growth, employment, and exploitation of natural resources in a developing country. Achievement of these benefits always entails risks, but the risks must be acceptable to the funding agency and the country. Reduction of risks costs money but so does incurring the unwanted impacts. Avoiding one risk may create a new risk; hence, nett risk is always a consideration. Thus, a risk assessment analyses trade-offs, compares risk levels, and evaluates cost-effectiveness of risk-reduction alternatives.

Risk management integrates ERA with technical, political, social, and economic issues to develop risk reduction and prevention strategies. Figure 9.6 illustrates the relationship between the elements of risk assessment and risk management for human health considerations. A similar model would be applicable for EcoRA too. As indicated by the figure, different types of information are used in ERA.

As an illustration of the various activities which constitute the process of ERA, the case study of a petroleum terminal and distribution project is provided as Annex 9.1 (page 272), which traces the risk assessment process through scoping and screening to the final decision.

In the case of industrial projects, a significant outcome of the risk management is the development of a disaster management plan (DMP) in the case of projects involving manufacture of potentially hazardous products. Recommendations for a typical DMP are given in the next section.