Integrated Risk Governance

Integrated Risk Governance (Speaker: A. Haas)

The TCM activity Integrated Risk Governance will address the question which risk governance structures can be helpful for managing integrated risks of a scale that may endanger the well-being of whole societies, or even humankind. With the notion integrated risk we address three related, but distinguished aspects of risk management:

• The need to simultaneously cope with different risks that interact in a synergetic way;

• The need to simultaneously address different categories of risk;

• The need to engage with a variety of scientific, management, and policy disciplines, and with stakeholders of various kinds in a transdisciplinary way for addressing the two aforementioned needs.

A key example of integrated risk is given by the need to address climate risks in a situation of global financial crisis. Another one by the need to address climate risks and risks to social stability in a nation like China.

This activity is collegated to the Integrated Risk Governance Project that Carlo Jaeger is chairing together with Prof. Shi Peijun of Beijing Normal University (where C.Jaeger has been given a honorary professorship in this setting) as well as to the Integrated Risk Governance Council, wher ETH-Zurich, Carnegie Mellon University, IUCN and series of other organisations develop policy advice on integrated risks.

The comparative advantage of TCM in this area is based on the unique portfolio of tools we are going to apply for our research. It combines well known and pioneering tools – which themselves in fact are toolboxes – in an unprecedented way. To mention some of the core toolboxes:

• Bayesian Risk Management,

• Bayesian Agents Modelling,

• Disaster Chains,

• Stakeholder Dialogues,

• Grounded Theory,

• Balanced Scorecards,

• Reflexive Theory.

A core challenge of researching integrated risks is how to cope with “the unexpected”. We want to address this challenge by using knowledge-based probabilities as defined by Bayesian Risk Management.  Knowledge-based probabilities rely on the Bayesian concept of probability as willingness to bet. Contrary to the standard concept of frequentist probabilities, knowledge-based probabilities allow to tackle risks without historic record, or with records that do not allow to apply standard tools of risk analysis. We will combine Bayesian reasoning with a variety of quantitative and qualitative methods. This combination is rapidly becoming the standard in the post-subprime world of risk management.

With this activity, TCM will be able to make experiences from integrated risk management available for dealing with climate risks, as well as the other way round. And it will be able to participate in one of the most promising areas of current transdisciplinary research at the interface of deep conceptual questions and urgent practical challenges.