(56t) Risk Based Process Safety:   Adopting a Differentiated Approach for Managing Risks and Reducing Process Incidents

The ultimate success of implementing risk based process safety is measured by actual risk reduction. CCPS red book on Risk Based Process Safety, Energy Institute framework, OSHA have all provided a set of elements that companies can use for effective implementation of Process Safety Management. Many of the standards and best practices are very well documented. Unfortunately, the risks for any company does not reduce unless these standards and best practices are converted into reality across all sites and involving relevant people.

In addition, many companies tend to engage consultants and conduct high quality technical studies and quantitative risk analysis due to legal requirements. However, very little is done to follow up on implementing the recommendations and results of these studies. So, despite using a significant amount of effort resources (both financial and human), there is very little contribution ro the reduction of actual risks.

There is no one size fits all approach to dealing with risks. All hazards and risks are not equal. And hence it is not practical to address all risks with the same level of intensity considering the limited resources enterprises have. Hence, adopting a differentiated risk approach that ensures that appropriate effort and resources are expended based on level of risk, resulting not just in the desired end state, but ensuring value for the investment.

Operational risk management is identifying, evaluating and controlling hazards and differentially managing associated risks to prevent injuries and incidents.

Enterprises must define their risk appetite taking into account the protection of people, assets, environment and business implications. Risk governance is defined in a way that takes this, as well as regulatory requirements, insurance and stakeholder’s considerations into account. Once the “tolerable risk” is defined, a framework for managing risks should be developed that clearly defines proportionate control mechanisms (engineered and administrative). The concept of proportionality is paramount; the allocation of resources must not be equal or democratic, but rather deployed to reap maximum benefit in terms of risk reduction.

This process contributes to better outcomes in terms of increased effectiveness of PSM and more importantly reduction of risks, while optimizing the money, time, and effort required.