0:06
So far, we have seen that chemical disasters can lead to anxiety,
societal disruption, and fear.
But what are the risks in the chemical industry exactly and how are these dealt with?
Risks related to chemical industrial activities are diverse.
On the one hand, there are the smaller risks such as falling from stairs,
falling from heights, tripping and slipping, and so on.
And as discussed in the introduction to this module,
these risks are called Type 1 risks and they can be found in every industrial sector.
They can be treated in a similar way in every organization.
On the other hand, the large risks or Type 2 risks in
the chemical industry are related to the industrial activities within chemical companies,
that is the use, storage,
processing of chemical substances.
Chemicals are characterized by properties that
make them hazardous such as their toxicity,
their flammability, their potential to explode, and so on.
And these hazardous materials are often contained in chemical installations,
under high pressure, and at high temperatures.
Therefore, the very nature of chemical industrial activities
determines the existence of Type 2 risks or so-called process risks,
unique to this industrial sector.
Large safety investments are required to tackle prevention and mitigation of
process risks and this is the field of
process safety management and process security management.
A factor that needs to be considered when dealing with risks in
the chemical industry is a different perception between experts and laypeople.
Experts are more inclined to mainly deal with probabilities in combination with
credible consequences and thereby tend to focus much
on Type 1 risks and also in Type 2 risks that they deemed credible.
In this way, they tend to disregard incredible Type 2 risks.
Laypeople, on the other hand,
tend to attach much more value to consequences than to
probabilities and thus they also value incredible scenarios.
Thus, civilians in Type 2 risks are
Type 2 risks driven and tend to undervalue Type 1 risks.
In case of Type 2 risks in the chemical industry,
which are risks characterized with
a very high impact in combination with a very low likelihood,
this can make an important difference.
It can lead to miscommunications and misunderstandings and eventually to
distrust between civilians and companies and governments.
2:38
Whether dealing with process safety risks or process security risks,
risks always need to be prioritized.
Budgets need to be allocated to invest in prevention
and mitigation measures based on the risk prioritization.
Here the divisions and viewpoints of laypeople and experts also has consequences.
The risk prioritization of laymen will largely be based on impact while
the risk prioritization of experts will be based on
the equal combination of impact and likelihood.
So, how can we bridge this gap in perception?
In order to bridge the gap,
it's vital to understand
the important psychological principle in the
decision making process called loss aversion.
Loss aversion refers to people's tendency to prefer
avoiding losses over equivalent gains.
Let us now consider the following example.
Assume you were given two options.
Option 1, I will give you five thousand euros with certainty and option 2,
we toss a coin and when it turns out to be heads, you'll receive nothing.
Tails, you'll receive 10,000 euros.
What option would you prefer?
By far, most people prefer the first option.
Five thousand euros with certainty.
Let's now frame this example another way,
that is in terms of losses.
Option 1, you have to pay me 5,000 euros with certainty and option 2,
we toss a coin.
If it is heads, you pay me nothing,
if it is tails you pay me 10,000 euro.
What option would you prefer this time?
By far, most people in this case prefer to gamble.
They dislike losing with certainty.
In other words, when it comes to gains people choose certainty,
when this comes to losses people prefer to gamble.
Translating this principle into safety terminology,
company top management would be more inclined to invest in production,
which are considered certain games than to invest in prevention,
which is considered as uncertain gains.
Also, top management is more inclined to risk highly improbable accidents perceived as
uncertain losses than to make large investments in dealing
with such accidents which are perceived as certain losses.
Also, top management is more inclined to risk highly improbable accidents perceived as
uncertain losses than to make large investments in
dealing with such accidents which are perceived as certain losses.
So top management and decision makers should therefore be aware of
this basic principle and take it into account when
making prevention investment decisions for dealing with process risks.
By doing so, decisions will automatically be more balanced and there
will be more alignment between experts and laymen.
So, what have we learned?
Risks related to chemical industrial activities are
diverse and can lead to fear and outrage in society.
Fortunately, not many chemical disasters
happen and the chemical industry puts a lot of attention on safety.
Every time an accident involving chemical substances happens,
the license to operate of chemical industrial activities is questioned.
So title trust goes down rightfully so since
no disaster involving hazardous chemicals should be able to happen.
However, when chemical disasters do occur,
there is a divisions in perception of risk between laymen and experts.
Risk assessors in the chemical industry, that is experts,
see risk as a combination of probability and impact whereas
the general public or layman plays a lot of emphasis on impact.
This divisions can lead to miscommunication and mistrust.
To solve this divisions,
the mentality of some decision makers needs to be improved.
If decision makers would understand that operational safety is
just as important for business as production and innovation,
then perhaps better decisions would be
made regarding process risks in the chemical industry.
This can be done by putting adequate emphasis on
loss aversion and its impact on safety investment decision making.
Many disasters such as the Deepwater Horizon offshore accident or
the Bhopal toxic gas disaster would probably not have occurred if this had been the case.
Marieke LiemDr.
Bibi van den BergProf. dr.
Edwin BakkerProf. dr.
Jim van SteenbergenDr.
Sabine RoeserProf. dr.
Margreet VosProf. dr.
Genserik ReniersProf. dr. ir.
Pieter van GelderProf. dr. ir.
