Why are risk decisions sometimes rather irrational and biased than rational and effective? Can we educate and train vocational students and professionals in safety and security management to let them make smarter risk decisions? This paper starts with a theoretical and practical analysis. From research literature and theory we develop a two-phase process model of biased risk decision making, focussing on two critical professional competences: risk intelligence and risk skill. Risk intelligence applies to risk analysis on a mainly cognitive level, whereas risk skill covers the application of risk intelligence in the ultimate phase of risk decision making: whether or not a professional risk manager decides to intervene, how and how well. According to both phases of risk analysis and risk decision making the main problems are described and illustrated with examples from safety and security practice. It seems to be all about systematically biased reckoning and reasoning.
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In Eastern Africa, increasing climate variability and changing socioeconomic conditions are exacerbating the frequency and intensity of drought disasters. Droughts pose a severe threat to food security in this region, which is characterized by a large dependency on smallholder rain-fed agriculture and a low level of technological development in the food production systems. Future drought risk will be determined by the adaptation choices made by farmers, yet few drought risk models … incorporate adaptive behavior in the estimation of drought risk. Here, we present an innovative dynamic drought risk adaptation model, ADOPT, to evaluate the factors that influence adaptation decisions and the subsequent adoption of measures, and how this affects drought risk for agricultural production. ADOPT combines socio-hydrological and agent-based modeling approaches by coupling the FAO crop model AquacropOS with a behavioral model capable of simulating different adaptive behavioral theories. In this paper, we compare the protection motivation theory, which describes bounded rationality, with a business-as-usual and an economic rational adaptive behavior. The inclusion of these scenarios serves to evaluate and compare the effect of different assumptions about adaptive behavior on the evolution of drought risk over time. Applied to a semi-arid case in Kenya, ADOPT is parameterized using field data collected from 250 households in the Kitui region and discussions with local decision-makers. The results show that estimations of drought risk and the need for emergency food aid can be improved using an agent-based approach: we show that ignoring individual household characteristics leads to an underestimation of food-aid needs. Moreover, we show that the bounded rational scenario is better able to reflect historic food security, poverty levels, and crop yields. Thus, we demonstrate that the reality of complex human adaptation decisions can best be described assuming bounded rational adaptive behavior; furthermore, an agent-based approach and the choice of adaptation theory matter when quantifying risk and estimating emergency aid needs.
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International Week workshop in Madrid over Sustainable Risk Leadership
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Business decisions and business logic are an important part of an organization’s daily activities. In the not so near past they were modelled as integrative part of business processes, however, during the last years, they are managed as a separate entity. Still, decisions and underlying business logic often remain a black box. Therefore, the call for transparency increases. Current theory does not provide a measurable and quantitative way to measure transparency for business decisions. This paper extends the understanding of different views on transparency with regards to business decisions and underlying business logic and presents a framework including Key Transparency Indicators (KTI) to measure the transparency of business decisions and business logic. The framework is validated by means of an experiment using case study data. Results show that the framework and KTI’s are useful to measure transparency. Further research will focus on further refinement of the measurements as well as further validation of the current measurements.
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The purpose of this study is to analyze the relationship between sustainable performance and risk management, whereby sustainability (innovation), interdisciplinarity and leadership give new insights into the traditional perspectives on performance and risk management in the field of accounting and finance.
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Risk assessment plays an important role in forensic mental health care. The way the conclusions of those risk assessments are communicated varies considerably across instruments. In an effort to make them more comparable, Hanson, R. K., Bourgon, G., McGrath, R., Kroner, D. D., Amora, D. A., Thomas, S. S., & Tavarez, L. P. [2017. A five-level risk and needs system: Maximizing assessment results in corrections through the development of a common language. The Council of State Governments Justice Center. https:// csgjusticecenter.org/wp-content/uploads/2017/01/A-Five-Level-Risk-and-Needs-system_Report.pdf] developed the Five-Level Risk and Needs System, placing the conclusions of different instruments along five theoretically meaningful levels. The current study explores a Five-Level Risk and Needs system for violent recidivism to which the numerical codings of the HCR-20 Version 2 and its successor, the HCR-20V3 are calibrated, using a combined sample from six previous studies for the HCR-20 Version 2 (n = 411 males with a violent index offence) and a pilot sample for the HCR-20V3 (n = 66 males with a violent index offence). Baselines for the five levels were defined by a combination of theoretical (e.g. expert meetings) and empirical (e.g. literature review) considerations. The calibration of the HCR-20 Version 2 was able to detect four levels, from a combined level I/II to an adjusted level V. The provisional calibration of the HCR-20V3 showed a substantial overlap with the HCR-20 Version 2, with each level boundary having a 2-point difference. Implications for practice and future research are discussed.
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Purpose: The purpose of this study is to find determinants about risk resilience and develop a new risk resilience approach for (agricultural) enterprises. This approach creates the ability to respond resiliently to major environmental challenges and changes in the short term and adjust the management of the organization, and to learn and transform to adapt to the new environment in the long term while creating multiple value creation. Design/methodology: The authors present a new risk resilience approach for multiple value creation of (agricultural) enterprises, which consists of a main process starting with strategy design, followed by an environmental analysis, stakeholder collaboration, implement ESG goals, defining risk expose & response options, and report, learn & evaluate. In each step the organizational perspective, as well as the value chain/area perspective is considered and aligned. The authors have used focus groups and analysed literature from and outside the field of finance and accounting, to design this new approach. Findings: Researchers propose a new risk resilience approach for (agricultural) enterprises, based on a narrative about transforming to multiple value creation, founded determinants of risk resilience, competitive advantage and agricultural resilience. Originality and value: This study contributes by conceptualizing risk resilience for (agricultural) enterprises, by looking through a lens of multiple value creation in a dynamic context and based on insights from different fields, actual ESG knowledge, and determinants for risk resilience, competitive advantage and agricultural resilience.
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There is an urgency and need to develop an innovative strategic approach for organizations to develop a sustainable organization for the future, in which they are able to respond resiliently to major environmental challenges and changes in the short term and adjust the management of the organization. On the same time, in this strategic approach learning and transforming accordingly in the long term is involved as well. This approach will give organizations the opportunity to operationalize their boards’ and stakeholders’ ambitions to build a responsible business, with focus on governance elements, as well as interaction with social and environmental factors, risk, and strategy from a holistic view. In education, students could work with this approach in future projects for real companies.
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Within recent years, Financial Credit Risk Assessment (FCRA) has become an increasingly important issue within the financial industry. Therefore, the search for features that can predict the credit risk of an organization has increased. Using multiple statistical techniques, a variance of features has been proposed. Applying a structured literature review, 258 papers have been selected. From the selected papers, 835 features have been identified. The features have been analyzed with respect to the type of feature, the information sources needed and the type of organization that applies the features. Based on the results of the analysis, the features have been plotted in the FCRA Model. The results show that most features focus on hard information from a transactional source, based on official information with a high latency. In this paper, we readdress and -present our earlier work [1]. We extended the previous research with more detailed descriptions of the related literature, findings, and results, which provides a grounded basis from which further research on FCRA can be conducted.
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Due to the ageing population, the prevalence of musculoskeletal disorders will continue to rise, as well as healthcare expenditure. To overcome these increasing expenditures, integration of orthopaedic care should be stimulated. The Primary Care Plus (PC+) intervention aimed to achieve this by facilitating collaboration between primary care and the hospital, in which specialised medical care is shifted to a primary care setting. The present study aims to evaluate the referral decision following orthopaedic care in PC+ and in particular to evaluate the influence of diagnostic tests on this decision. Therefore, retrospective monitoring data of patients visiting PC+ for orthopaedic care was used. Data was divided into two periods; P1 and P2. During P2, specialists in PC+ were able to request additional diagnostic tests (such as ultrasounds and MRIs). A total of 2,438 patients visiting PC+ for orthopaedic care were included in the analysis. The primary outcome was the referral decision following PC+ (back to the general practitioner (GP) or referral to outpatient hospital care). Independent variables were consultation- and patient-related predictors. To describe variations in the referral decision, logistic regression modelling was used. Results show that during P2, significantly more patients were referred back to their GP. Moreover, the multivariable analysis show a significant effect of patient age on the referral decision (OR 0.86, 95% CI = 0.81– 0.91) and a significant interaction was found between the treating specialist and the period (p = 0.015) and between patient’s diagnosis and the period (p < 0.001). Despite the significant impact of the possibility of requesting additional diagnostic tests in PC+, it is important to discuss the extent to which the availability of diagnostic tests fits within the vision of PC+. In addition, selecting appropriate profiles for specialists and patients for PC+ are necessary to further optimise the effectiveness and cost of care.
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