Risk management is information management which considers the relationship between knowledge and the lack thereof


In this context, the risk of a certain event, R(E), simply represents the probability of a dangerous event, p(E), multiplied by the amount of the expected damage (D), or: R(E) = p(E) x D (Bora, 2007). This is the concept from applied information theory, and it is commonly used by insurance companies, law courts, public administrations, and similar institutions. In this regard, risk management is essentially information management, which considers the relationship between knowledge and non-knowledge. The quantitative definition of risk is suggested based on the concepts of "relativity of risk" and "acceptability of risk" (Kaplan & Garrick, 1981). Risks were traditionally "expressed in dollar terms, days lost as a result of accidents or disease and in disease rates or body counts" (Short, 1984, p. 716).

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