Financial Management of Large-Scale Catastrophes

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Dramatic events, such as the earthquake that struck China’s Sichuan Province in 2008 and the devastation caused by Hurricane Katrina in the United States in 2005, have brought the financial management of catastrophic risks once again to the forefront of the public policy agenda globally. To address these issues and develop sound policies, the OECD has established an International Network on the Financial Management of Large-Scale Catastrophes. This publication supports the ongoing activities of the Network.

This book contains three reports focusing on different institutional approaches to the financial management of large-scale catastrophes in selected OECD and non-OECD countries, the role of risk mitigation and insurance in reducing the impact of natural disasters, and the importance of strategic leadership in the management of non-conventional crises.


Part 3. Introduction

Whenever the issue of new risks and emerging crises arises, the spectre of September 11 casts its shadow. But 9/11 is not the only issue. For instance, Katrina has altered the agenda of influential circles in Washington, which are now calling for an "all-hazards approach” less focused on the single problem of terrorism. More generally, we find ourselves today in a transitional period, marked by global discontinuities with respect to security and vulnerability on all fronts - environment, climate, demographics, public health, technology, social dynamics, economic tensions, geostrategy, violence. Whatever the field, we now see the curtain fall on an era whose mantra was “everything is under control" - the misleading guiding principle that dominated the approach to risk and crisis throughout the years 1980 to 2001. In other words, we have witnessed "the end of zero risk" (Lagadec-Guilhou, 2002), and we now need a new vision and new practices.


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