Riskwashing Identification and Minimization

Abstract

Abstract "Riskwashing" is to safety as "Greenwashing" is to ESG. Riskwashing refers to a situation where an organization engages in superficial or insincere actions to create the appearance of addressing a particular risk or issue, without actually taking substantive action to address the underlying problem. Incident investigations are a common source of activities that can be labeled as "riskwashing", due largely to a deep human and organizational need to do something (anything!) after an incident even though there may be no real way to prevent it from happening again. This is especially true after an unplanned event occurs which realizes significant actual consequences, even when such outcomes were extremely unlikely. Riskwashing is costly in terms of inefficient allocation of resources and addition of bureaucratic friction to operations. This paper presents methods to identify and minimize riskwashing as an organizational response to incidents. The paper is based upon examination of incident investigations carried out for and by a variety of organizations including oil and gas operators and service companies. The activities presented as corrective actions are examined against a simple logical test to determine their value in reducing the risk revealed to the organization by the subject unplanned event. Study of a large sample of incident investigations reveals that in a significant number of cases the activities presented as corrective actions do nothing to reduce the risk revealed to the organization by the subject unplanned event and thus conform to the definition of riskwashing. The simple logical test used to identify riskwashing activities is fully described and can be deployed by organizations to identify and minimize the associated cost impacts and more effectively manage risk.