13.2 Modern Risk Tolerance
193
13.2.2 Societal Risk Tolerance
Societal risk tolerance is generally based on a “casualty cost” of failures. Figure 13.4
shows the ANCOLD tolerance criteria as well as the Whitman life risk tolerance
compared with what occurred in the decades 1979 and 1999to TSF and Nuclear 5+
accidents over 14,000 years-reactors (Oboni and Oboni 2013). Recent studies have
shown that Whitman thresholds remain valid nowadays provided a correct WTP is
used (see Sect. 13.1.2).
Once the risks incurred by an operation are estimated, rational and sustainable
decisions on risk mitigation are generally requested by clients wishing to adopt risk
management methods and maximize the investment they have made by performing
a risk assessment. These can only be taken after an explicit risk tolerance function
in defined. The tolerance function can be:
• derived formally (mathematically) from client’s financial data;
• defined empirically;
• derived from public opinion tests;
• “negotiated”.
Generally the final tolerance curves selected by clients are the result of a mix of
these various approaches.
Tolerable risk curves are always project- and owner-specific and indicate the
level of risk which has been deemed acceptable by an owner for a specific project or
operation (possibly taking into account public opinion). This means, as an example,
that within large companies corporate risk tolerability may differ quite substantially
from that of a branch operation.
Fig. 13.4 ANCOLD tolerance criteria, Whitman life risk tolerance compared with TSF failure
occurrences in the decades around 1979 and 1999, Nuclear 5+ accidents over 14,000 years-reactors
(Oboni and Oboni 2013)
193
13.2.2 Societal Risk Tolerance
Societal risk tolerance is generally based on a “casualty cost” of failures. Figure 13.4
shows the ANCOLD tolerance criteria as well as the Whitman life risk tolerance
compared with what occurred in the decades 1979 and 1999to TSF and Nuclear 5+
accidents over 14,000 years-reactors (Oboni and Oboni 2013). Recent studies have
shown that Whitman thresholds remain valid nowadays provided a correct WTP is
used (see Sect. 13.1.2).
Once the risks incurred by an operation are estimated, rational and sustainable
decisions on risk mitigation are generally requested by clients wishing to adopt risk
management methods and maximize the investment they have made by performing
a risk assessment. These can only be taken after an explicit risk tolerance function
in defined. The tolerance function can be:
• derived formally (mathematically) from client’s financial data;
• defined empirically;
• derived from public opinion tests;
• “negotiated”.
Generally the final tolerance curves selected by clients are the result of a mix of
these various approaches.
Tolerable risk curves are always project- and owner-specific and indicate the
level of risk which has been deemed acceptable by an owner for a specific project or
operation (possibly taking into account public opinion). This means, as an example,
that within large companies corporate risk tolerability may differ quite substantially
from that of a branch operation.
Fig. 13.4 ANCOLD tolerance criteria, Whitman life risk tolerance compared with TSF failure
occurrences in the decades around 1979 and 1999, Nuclear 5+ accidents over 14,000 years-reactors
(Oboni and Oboni 2013)