The impact of Science and Technology on Risk in our Society

1. The impact of Science and Technology on Risk in our Society J.P.CONTZEN Instituto Superior Técnico Lisbon, March 11, 2005

2. Introduction (1) • An evolving scene where the balance sheet of the interaction between S&T and Risk could be either negative or positive. • How to enhance the positive side? It is a matter of governance; several examples could be given in this respect

3. Introduction (2) Hence, the structuring of the presentation in several parts: • The evolving nature of risk • The elements of risk governance • R&D and risk governance • An emotional example: biotechnology and the application of the precautionary principle • An emerging issue: nanotechnology • An embarrassing case: the tsunami of December 26, 2004 • A new type of risk: global security, tackling terrorism and weapons of mass destruction

4. Definition of Risk • “Risk should be understood as an uncertain consequence of an event or an activity with respect to something that human values” (Kates and Kasperson 1983) • Risk is difficult to evaluate: it is the combination of two independent factors: Risk = Severity of a dangerous event (consequence) x Probability of occurrence of this event(uncertainty)

5. The evolving nature of risk • Our Knowledge-Based Society of the 21st Century is experiencing increased risk caused by human activities. The reasons could be found in: • Acceleration of technological innovation • Greater connectiveness, globalization • Increased pressure to reach markets • Additionally, human activities lead to an increase in the frequency and severity of natural disasters, e.g. impact of deforestation or greenhouse gases emission

6. The Impact of Globalization (NZZ, May 3, 2003)

7. Risk Governance

8. The need for governance (1) • Risk should not considered as a fatality even if a zero-risk society does not and will never exist. • It is a matter of governance and in this exercise of governance, science and technology can contribute positively in preventing or mitigating some of the threats that they have generated themselves.

9. The need for governance (2) • What is Governance? Governance is “The sum of the many ways that individuals and institutions - public or private - manage their common affairs” (from “The role of the World Trade Organization in Global Governance” edited by Gary P. Sampson, UNU Press, 2001)

10. The Framework for Risk Governance Risk Governance Framework(Components and Contextual Aspects) • Contextual Aspects: • Risk Perception • Actor Network • Organisational Capacity • Regulatory Styles • etc • Pre-Assessment: • Problem Framing • Early Warning • Risk Governance Process Risk Appraisal: • Risk Management: • Option Generation • Option Assessment • Option Evaluation & Selection • Option Implementation • Option Monitoring • Risk Assessment: • Hazard Identification & Estimation • Exposure & Vulnerability Assessment • Risk Estimation • Consideration of Stakeholder& Public Group Concerns • Tolerabilty / Accepta- • bility Judgement: • Risk Characterisation • Risk Evaluation

11. Developing a model for risk governance (1) • Governing all the components of the framework requires a certain institutional capacity. Does Society possess this capacity? For giving an answer to such question, one requires an analysis of the various elements constituting such capacity. • Such analysis can be performed using a model for risk governance.

12. Developing a model for risk governance (2) • Governing risk implies dealing with highly complex, adaptive systems operating under the pressure of dynamic external conditions • Risk governance can be assimilated to a process function with inputs, process parameters and outputs.

13. Developing a model for risk governance (3) • This model is not focused on the outputs such as effectiveness and efficiency, equity and fairness, transparency, accountability but on the elements of the process itself. • It concentrates on the identification of the governance components and on the possible evaluation of their respective strengths. The model could be used in this respect as a benchmarking tool for institutional risk capacity of nations, local governments, industries

14. Components of risk governance (1) • The model corresponds to own research but the identification of the components has been inspired by the work of Gilles Paquet, Centre on Governance, University of Ottawa (Chapter 7 « The New Governance, Subsidiarity, and the Strategic State »  of the 2001 OECD book « Governance in the 21st Century ») • Governing a complex adaptive system implies acting on a institutional process composed of Assets, Skills and Capabilities

15. Components of risk governance (2) • The Assets constitute the base of the process; they are made of: • Rules (explicit, tacit), Norms, Regulations establishing rights and obligations • Resources such as money, information and infrastructures, facilities • Competencies and knowledge i.e. education, training, experience and expertise • Organizational capital i.e. the capacity to make effective use of these first three types of assets

16. Components of risk governance (3) Assets = (Rights + Resources + Competencies ) X Organizational Capital

17. Components of risk governance (4) • The Skills allow the good use and the enhancement of the impact ofthe assets by political, economic and civic actors, when responding to external conditions. • Skills relate to: • Flexibility i.e. providing new ways to make sense of the situation, adapting to change (e.g. fight against institutional inertia)

18. Components of risk governance (5) • Vision i.e. bringing new practices into a context that would not naturally generate them, anticipating change (e.g. attention devoted to foresight and to scenario planning) • Directivity i.e. reframing the whole perception of the way of life, driving change, impacting on the external environment rather than exercising prevention or mitigation of the effects of external forces (e.g. ban on CFCs or ban on WMDs)

19. Components of risk governance (6) Skills = Flexibility + Vision + Directivity

20. Components of risk governance (7) • Finally, the Capabilities constitute the frameworkin which Assets enriched by Skills can be exploited for making risk governance successful • Capabilities are constituted of successive layers: • Relations between agents and sources of knowledge, between those carrying the authority and those bearing the risk, notably the Civil Society

21. Components of risk governance (8) • Networks, a step furtherin organization,clan-like links between groups of actors, halfway between self-organization and hierarchy. The role of NGOs in risk governance is an issue • Regimes establishing laws of the game. The Precautionary Principle is a recent relevant example.

22. Components of risk governance (9) Capabilities = Relations² + Networks + Regimes

23. Components of risk governance (10) • Putting the three components together leads to: Governance = Assets X Skills X Capabilities

24. Components of risk governance (11) • The ambition of this model is assisting in identifying the components of risk governance and singling out those components that might require special attention for achieving success. The importance of “soft elements” such as organizational capital, adaptation to change and relations has to be underlined. Science and Technology play a role; they are necessary elements but they don’t suffice for ensuring adequate governance.

25. Establishing a strength indicator (1) • The model when considered in the right context could yield some form of strength indicator. An example is given here. • By attributing numerical ratings to each factor within the three major components (e.g. 5 for good/strong to 1 for poor/weak), one could calculate such indicator

26. Establishing a strength indicator (2) • City planning for coping with extreme climatic events: Gonaives, Haiti vs. Tokyo, Japan • Assets: • Rules: G = 1; T = 5 • Resources: G = 1; T = 4 • Competencies: G = 2; T = 5 • Organizational capital: G = 1; T = 5 Total for Assets: G = 4; T = 70

27. Establishing a strength indicator (3) • Skills: • Flexibility: G = 1; T = 3 • Vision: G = 1; T = 5 • Directivity: G = 1; T = 4 Total for Skills: G = 3; T = 12

28. Establishing a strength indicator (4) • Capabilities: • Relations: G = 1; T = 5 • Networks: G = 1; T = 4 • Regimes: G = 1; T = 4 Total for Capabilities: G = 3; T = 33

29. Establishing a strength indicator (5) • Putting the three components together leads to : Governance Strength = Assets X Skills X Capabilities which in numerical terms yields a total of 36 for Gonaives and of 27720 for Tokyo. • If each factor would have received the maximum rating of 5, the total would have been 39375, hence a relative figure of 0.09% for Gonaives and of 70% for Tokyo

30. R&D and Risk Governance

31. A Model for Risk Governance? (1)

32. A Model for Risk Governance? (2) • Why did you smile when looking at the cartoon? (if you did smile): • Wrong Technological solutions? • Overestimation of the risk? • Personal choice of skier or public regulation?

33. A Model for Risk Governance? (3) • This leads to the analysis of four discussion areas: • Do we need to accelerate the development of new technologies? • How could Research better contribute to Risk Assessment: an improved scientific approach? • Public vs. Private Governance • A new alliance between Regulation and Research

34. New technological developments • A good S&T base exists in most areas for contributing to risk prevention and risk mitigation • Three fields require enhanced efforts: • Better information gathering technologies: early warning, faster diagnostics tools • New self preventing, self mitigating techniques: self repairing materials, machines, systems • Increased attention devoted to dual-use technologies: improve their proliferation resistance, find alternative technologies

35. Scientific approach to Risk Assessment (1) • Current scientific methods still suffer from Laplace’s Demon : linear, deterministic, mono-causal view of the world. A more extensive move to a complex, non-linear chaotic approach is required. Mechanistic models of Society lose individual action in statistical average whereas in a chaotic approach, individual action can have decisive consequences (A.J. Wierzbicki)

36. Scientific approach to Risk Assessment (2) • Predictions have given place to probabilities. « Hard Science does not provide definitive truth but better truth » (Oro Giarini) • Look at small variations in initial conditions and small initial fluctuations, microscopic changes in parameters, discriminate weak signals from noise (AIDS, CJD, Tuberculosis,…)

37. Scientific approach to Risk Assessment (3) • The new methods should privilege a holistic approach looking at overall systems and not just at some parts of them. Too often, the risk is shifted rather than being prevented or mitigated e.g. in sustainability issues: waste management, energy savings, air pollution, water management • The cost/benefit analysis should be refined both in economic and social terms

38. Scientific approach to Risk Assessment (4) • Examples where social costs are neglected: • The irritation of Prince Charles, Duke of Wales, when a local council cut chestnut trees arguing that falling chestnuts might hurt passers-by • Does the cost/benefit analysis of performing an Asteroid Watch justifies its development while medical research on identified threats is still under funded?

39. Scientific approach to Risk Assessment (5) • Cost/benefit analysis is often rudimentary while it is an essential element of any assessment: currently risk reduction gains are purchased at much higher costs than in earlier times, hence the importance of the economic factor. This is one of the weakest features of the recent application of the Precautionary Principle, e.g. in the BSE case. It is an area where wide differences appear in results, e.g. the difficulty for fixing the economic value of a human life (1 Swiss worth 100 Portuguese lives)

40. Scientific approach to Risk Assessment (6) • Options in resource allocation are an essential component in risk management: “Save the Planet and ruin the World” • Is it justified to spend in risk prevention 4.2 M$ for environmental remediation against 50 000$ for transport safety or 20 000$ for health improvement with the equivalent result of one year of human life saved? (Harvard study) • The decision on all these cases is clearly a political one but has the scientific, social and economic background been sufficiently detailed?

41. Public vs. Private Governance (1) • The role of research in risk management requires a prior analysis of the possible governance schemes including the public vs. private responsibility issue • In the industrial age, prevailed “the individualism of risk-calculating merchants [and industrialists], learning from experience, attentive to news, making decisions on a well-judged mix of trust and distrust” (Niklas Luhmann)

42. Public vs. Private Governance (2) • In the post-industrial age, with the emergence of newer risks, a more organized, more collective attitude tends to be favored • Globalization, Connexity (Geoff Mulgan) increase collective risks hard to fight on an individual basis: terrorism, infectious diseases, environmental damage, financial bubbles

43. Public vs. Private Governance (3) • A more collective management of risk implies a strong social cohesion. In certain areas, where major risks are concentrated on a minority of people, solidarity is an issue, especially when widening disparities in wealth emerge.

44. Public vs. Private Governance (4) • It may lead some categories of people to provide for their own risk management. A private approach in risk management is linked to a certain degree of affluence. The attitude of citizens of German Länder towards health insurance is representative of such correlation as shown in the coming slides

45. Source: STERN, 18/2004, p. 56

46. Public Regulation (1) • Is a greater regulatory role of the State compatible with the respect of the individual? Who governs the regulatory process: the public authority under a regime of elected democracy with a delegation of power, or direct democracy with an active participation of the civil society (citizens, pressure groups)? Will one day pilots be chosen by passengers before flight departure? (J.M. Lehn)

47. Public Regulation (2) • Four regulatory styles can be considered (Harry Otway): • Adversarial style: regulations developed in open confrontation, recourse to judicial process, transparency of information • Consensual approach: process based on views of elite groups, evolving to broader consultation

48. Public Regulation (3) • Authoritative style: government negotiates with industry (the risk creating actor) and decides • Corporatist model: involvement of different interest groups that seek to find mutual advantage in collective action • The impact of research differs largely according to the style that is prevailing

49. Regulation and Research (1) • What kind of relation should be established in the future between governments acting as regulatory bodies and the research community? Should they remain closely associated as they did in the past or should they in the future be kept at arms-length? • Two schools of thoughts: William Leiss (Canada) and Arie Rip (Netherlands).

50. Regulation and Research (2) • Arie Rip’s approach: Scientists in advisory positions offer a unique and powerful capital of expertise. «They should provide detailed and specialized research findings but must also have the knowledge skills and understanding to relate these findings to social and political concerns even if this causes a dilemma when their loyalty to those asking advice comes into conflict with the requirements of their scientific profession»