Risk Culture Case Study

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The origins of a risk culture as a concept can be traced back to the 1980s, when researchers started investigating industrial accidents and safety. Some features of the risk culture have been discussed by Barry
Turner (1978), who provided the theoretical basis for exploring the origins and causes of man-made disasters. One implication of his studies is that the culture of the organization is positioned at heart of the safety issues. (Turener 1978; Pidgeon & O’Leary 2000) Zohar (1980) has extensively examined the subject of industrial safety and introduced such term as ‘safety climate’, which is defined as “an employee perception of the priority an organization (or direct supervisor) places on safety” (Zohar 1980). The researcher concludes that
(Sants 2010) PricewaterhouseCoopers (PwC) considers risk culture to be a “collective ambition” to understand, identify and accept responsibilities for managing risks. Moreover, PwC notes that the right culture prioritizes risk management practices, ethical behavior and prudent decision-making. (PwC 2016) A further definition is offered by The International Institute of Finance (2013), an influential financial industry trade group, who considers risk culture “as the norms and traditions of behavior of individuals and of groups within an organization that determine the way in which they identify, understand, discuss, and act on
She describes artifacts as the formal structures and processes that guide the ways in which organizational members manage risk. By espoused values the author means the internal environment that encompasses and sets the tone for how risk is viewed and addressed, which includes risk philosophy and ethical values. Finally, Röschmann defines basic assumptions as beliefs and values of an organization that have been learned over time to being considered as the correct way of thinking and acting about risk. (Röschmann 2016)
Existing literature on the risk culture focus on three important features, namely values, attitudes and general awareness of risk and ethics; behavior of individuals within an organization to risk taking and control; and organizational aspects – processes and structures (Röschmann 2014). Hence, it can be argued that the essence of a prudent risk culture is the creation of an environment, which encourages proper risk

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