Risk and Regulatory Policy

Improving the Governance of Risk

image of Risk and Regulatory Policy

We expect governments to protect citizens from the adverse consequences of hazardous events. At the same time it is not possible or necessarily in the best interest of citizens for all risks to be removed. A risk-based approach to the design and implementation of regulation can help to ensure that regulatory approaches are efficient, effective and account for risk/risk tradeoffs across policy objectives. Risk-based approaches to the design of regulation and compliance strategies can improve the welfare of citizens by providing better protection, more efficient government services and reduced costs for business. Across the OECD there is great potential to improve the operation of risk policy as few governments have taken steps to develop a coherent risk governance policy for managing regulation.  

This publication presents recent OECD research and analysis on risk and regulatory policy.  The chapters discuss core challenges today. They offer measures for developing, or improving, coherent risk governance policies. Topics include: challenges in designing regulatory policy frameworks to manage risks; different cultural and legal dimensions of risk regulatory concepts across OECD; analytical models and principles for decision making in uncertain situations; key elements of risk regulation and governance institutions; the use of management-based regulation to help firms make risk-related behavioural changes; an analysis of the risk-based frameworks of regulators in five OECD countries (Australia, Ireland, Netherlands, Portugal, United Kingdom) and across four sectors: environment, food safety, financial markets and health and safety; and the elements for designing formal guidelines for risk prioritisation, assessment, management and communication.




Risk Regulation and Governance Institutions

This chapter offers a critical overview of the key elements of risk regulation and governance institutions, regarding risks to health, safety, environment, security, finance, and other areas. It emphasises the challenges for risk regulation of increasing interconnectedness in a multi-risk world, including: the need to assess the joint effects of simultaneous exposure to multiple risks; the increasingly rapid spread of risks across networks; and the ubiquitous ancillary impacts of risk regulation such as riskrisk tradeoffs. The chapter advocates: comprehensive regulatory impact assessment of the full portfolio of impacts of risk reduction efforts; both ex ante (prospective) regulatory impact assessment to inform initial policy decisions, and ex post (retrospective) regulatory impact assessment to inform subsequent policy revisions and to improve ex ante assessment methodologies; evenhanded use of regulatory analysis both to discourage undesirable policy proposals and to encourage desirable policy proposals; greater use of economic incentive instruments in regulation; and better co-ordination and oversight of risk regulation policies across agencies within each government, and across governments internationally.


This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error