Risk / Risk Analysis

The idea of risk combines two notions: that of the likelihood of something happening, or failing to happen, and the undesirability or disvalue of that outcome. Utilitarian decision-making involves three tasks: a) identifying the range of courses available in a given context; b) assigning utility values to the foreseeable outcomes of each course, and c) estimating the probability of each outcome. Most commonly such thinking focuses on positive values for utility, but negative utilitarianism argues for minimising negatives (inutilities) and is therefore more inclined to think in terms of risks than of opportunities. Risk analysis is now a common practice in corporate, government and financial sectors, particularly in relation to environmental, economic and social impacts. Apart from the obvious challenge of predicting outcomes there are several ethical and philosophical questions about risk analysis. First, the nature of the values to be considered: is it happiness, health, length of life, opportunity, or all of these and others besides? Second, the constituency over which risk is defined: is it those immediately affected, or those remotely affected, and should there be discounting for distance? and should it include future as well existing generations? This last question introduces the ‘person-affecting’ issue, since different courses will lead to different people and different numbers of people being born. Third, there is the issue of the inevitability of risk and negative outcomes. No course of action is risk free, and the selection of which risks to consider and the setting aside or neglect of others may indicate question-begging biases.