Auteur: Jack P. Kruf

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The European Research Council (ERC) has granted prof. Barbara Vis from Utrecht University School of Governance (USG) a Consolidator Grant for the research project entitled ‘Politicians under Radical Uncertainty: How Uncertain Phenomena Influence Political Elites’ Behaviour’. How do political elites respond to both radically and resolvably uncertain phenomena? Thanks to the ECR grant of 2 million euro the RadiUnce research team led by Vis will address the lack of attention to radical uncertainty in theories and empirical analyses of political behaviour. Read more

nl• De European Research Council (ERC) heeft prof. dr. Barbara Vis van het departement Bestuurs- en Organisatiewetenschap (USBO) een Consolidator Grant toegekend voor het onderzoeksproject ‘Politicians under Radical Uncertainty: How Uncertain Phenomena Influence Political Elites’ Behaviour’. Hoe reageren politieke elites op zowel radicale als oplosbare, onzekere fenomenen? Dankzij de ECR-subsidie van 2 miljoen euro zal het RADIUNCE-onderzoeksteam onder leiding van Vis het gebrek aan aandacht voor radicale onzekerheid in theorieën en empirische analyses van politiek gedrag rechtzetten. Lees meer

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UDiTE the European Federation of Local Government Chief Executives joined forces again today (01/06/22) with VEOLIA to host an EU Green Week 2022 to discuss how we can make the Green Deal a success locally. Under the expert moderation of Tamsin Rose, we debated the the concept of a functioning territorial ecosystem.

After a short video introduction from Stéphane Pintre, UDiTE President, on the role of the Chief Executive in local government in changing times, speakers spoke about how to inspire stakeholders, businesses and citizens that are essential to such game changing projects. From an EU perspective, delivering outcomes for the 2021/27 programmes & achieving 2030 goals depends upon it.

Our panellists, shared their experiences that included a Key note from Stéphane Perrin, Vice President of the Brittany Region, on the Breton regional ecosystem “Breizh Cop” that is accelerating an integrated green transition in Brittany.  Stéphane delivered a number of direct messages to the European Union about the need to be consistent between the long term vision and the detailed eligibility criteria for the EU Structural and Investments Funds 2021-27 on issues such as Green H2 buses being excluded from funding, important to local and regional authorities, for them to reduce carbon emissions.

Tu Doan-Quynh Bui from Renaissance Ecologique, certainly showed how a picture speaks a 1000 wordsthrough her fresco approach to help citizens visualise our journey together on the green transition.

Louis Duffy, Director for Environment at Cork County Council, ‘hot foot from a presentation to the Irish Parliament yesterday on climate change, showed how their shared services agenda in Ireland is contributing to coordinated and specialised actions in 4 regions that are now regrouping the 31 Irish local authorities in the call to action by 2030 and 2050.

Xavier Boivert focused on the importance of the local dimension having  the essential building blocks of the territorial ecosystem and underlined the role that municipal managers play in bring the different interests together across the community in support of concerted actions.

Guillaume Meynet from Veolia, spoke about Veolia’s latest game changing projects for ecological transformation including a pioneering waste water to fresh water treatment system in an increasing number of drought impacted regions in France.

Finally, Mario Grubišić from the secretariat of the ENVE commission in the EU Committee of the Regions talked about the Committee’s latest initiative Green Deal, Going Local that includes a call for local authorities to pledge to plant 3 billion trees by 2030, to showcase innovative climate action and commitments and to gather feedback on how the Green Deal is being perceived in the regions.

The video stream, slides and individual videos will be uploaded here in the next few days. Bookmark this page for the time being and we will reach out to you via Eventbrite to confirm when the materials will be ready. A big thank you to all of our speakers and especially for the hard work of our interpreters Laurent and Isabelle. Thank you.

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Putting a risk management process into place is relatively easy. Making sure that process operates to deliver the real benefits of good risk management is a much more difficult task.

This advanced course is designed to explore a number of the key factors that must be considered and addressed in order for risk management to operate effectively and add real value to the organisation. Read more

 

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Peter Young | February 2007, Public Risk Forum

Are there differences between risk management in the public and private sectors? As a professor who has spent time in both public administration and business administration programs, I have had several opportunities to think about both sides of the debate. 

On one side, we have those who argue that management is management and that differences in the public and private sectors are modest (“if only government were run like a business”). Opponents of the “management is management” point of view argue that the public sector is so different from the private sector that it is a distinctly separate thing and, thus, requires different knowledge and management skills.

For a very long time, I tended to believe that “management was management.” Politics exist in private and public organisations, and both have multiple stakeholders. Some large private organisations have dispersed authority, while some public institutions have fairly focused authority. Some private organisations are very process-oriented and some public entities emphasize outputs. Further, it is difficult to draw demarcation lines between public and private sectors. What would we call, for instance, an arrangement where a private transportation company is contracted to a nonprofit care facility for disabled individuals, which in turn is under contract with a local authority?

“Indeed, we might say that if a risk is able to be managed privately, there is a reasonable chance it is not – by definition – a public risk” 

In recent years, however, I have begun to change my views on public vs. private risk management, and I now believe that while there are important similarities, the “public” aspect of public management does present some important distinctions. I would like to address those distinctions in this essay.

Public sector risk management differs from its private sector counterpart because:

• Governmental entities, as social institutions, present an exposure to risk that is substantively different from a private entity. 
• The characteristics of public risks present a set of risk management issues not fully present in the private sector, including:
• Inability of government to avoid responsibility for risks within its purview.
• Frequent absence of markets as a risk management tool.
• Complexity of relationships between risks.
• The interaction of risks with governmental purposes.
• The breadth of the government’s exposure to risk.

Being in the public sector does present public risk managers with a set of distinct challenges. Notably, this means that government involvement in public affairs commonly arises when private behaviors (and markets) are somehow unable to deliver the good or service efficiently, if at all, or to manage a risk. Although we know there are degrees of government intervention, risks, goods, and services that meet the test of government intervention have done so because of characteristics that are not “market manageable.” 

They exhibit characteristics of high complexity and high uncertainty (often), they are market-failure inducing, and their effects on the public are diffuse. Also, the effects of these risks may call into question matters of fairness and social adequacy and thus may be impervious to tests of economic efficiency. 

So, one distinction between private and public risk management is that the risks are substantially different. Indeed, we might say that if a risk is able to managed privately, there is a reasonable chance it is not – by definition – a public risk. Additionally, the nature of government and its authority and responsibility is different. Whereas government might privatize garbage collection, or a health care delivery, or prisons, government’s responsibility and authority for those activity areas remains. Operating in the public sector makes the risks different, and it makes exposure different too. 

“…we need to be reminded that public organisations may have responsibility for organisational and social risks, and that traditional risk management skims the surface and fails to attack risk comprehensively”

I think the preceding discussion suggests some other relevant lessons for risk management. The typical risk manager has responsibilities for a set or risks that can be characterized generally as falling within the “organisational risk” domain — property loss exposures, legal liability-based risks, workers’ compensation exposures, and so on. While all these areas are important, we need to be reminded that public organisations may have responsibility for organisational and social risks, and that traditional risk management skims the surface and fails to attack risk comprehensively. A broader framework for thinking about risk management is necessary. We call this broader framework enterprise risk management (ERM). 

Second, by raising the possibility that the management of social risks is part of public risk management, we extend the accumulated knowledge of the risk management field into the public policy arena, where it has been woefully absent. For example, the systematic and critical analysis that risk managers apply to complex property and liability risks would be a breath of fresh air in the debate over public investment in alternative energy development. It is sad to say that today’s risk managers are rarely involved in public policy planning and execution, but this must change and there is evidence, if fact, that it is. 

Recommended

https://www.primo-institute.com/reconsidering-the-public-private-sectorrisk-management-divide/

Design: © Jack Kruf

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A plea for a new search for ‘responsible-in-the-end’ leadership: stewardship

Jack Kruf | 10 March 2017

Of course, we have our democratic system as a great set of principles and values as a form of equipment for good public governance. Public leadership, concerning that of public organisations as well as of the public domain of society, is embedded in this system, at least it should be. You may expect excellent results, because the democratic system traces back to the Greek δημοκρατία 508 BC, and itself is tested and challenged over and over again. Through the millennia it developed until now.

Considering the present state of society and of natural ecosystems you may be surprised by the results of this period of 2525 years of development. The Global Risks Reports published by the World Economic Forum – published since 2005 – tell the story of how critical the earth condition is. Reading these reports I had a flashback to the year 1972 when the Club of Rome presented facts, findings and figures in the report The Limits to Growth. Since at least five decades (i.e. half a century!) we know what is going on and where many generations of leadership has brought us.

Not that good

Within this democratic system the results of our public leadership over the years are not that good. Autocratic systems perform not better. More than ever public risks – being deviations, harms and losses related to the public values we so highly pamper – seem to emerge at a faster pace – such as there are disruptions caused by climate change and cybercrime, large scale pollution and poverty, fundamental lack of social cohesion, water shortage and migration issues. Well, what can we say about risk leadership while leadership itself seems to be the risk? We elaborate on this.

Redefinition

Public leadership must be reconsidered against the background of the structural and diminishing trust of citizens in politics as a whole as well as in public organisations. In society you more and more sense and hear Houston we have a problem. The general feeling is that public leaders do not listen to citizens and companies, are perceived as the ‘elite’, do not act in line with their promises during election time. What makes things worse is the disappearance of public leaders after a governing period of 4 – 6 year, when their term has come to an end, and make place for a new wave politicians, all with new promises.

It seems that risk leadership itself has become a risk

There seems to be much governance from the board room and from behind the desk. The living world of society seems to be separated from the ruling system world, where the leaders actually live in. There is this hugely felt need under citizens, clients, companies and if they could talk to us by natural ecosystems as forests and coral reefs – for leaders that listen to the wants and needs and from there truly generate values as safety, balance, cohesion, continuity, predictability, protection and security. There are gaps and risks (as form of harms and losses to values), all over the place.

From this perspective it is obvious that managing and governing the public risks, that emerge in society – well defined as risk leadership – needs to be redefined. It seems that leadership itself has become a risk factor. The so called risk leaders who cause risks in stead of leading us in the prevention, approach, mitigation and management. That is worrying, because the right course of public governance, anchored in the basic of democracy, depends on this. This aspect of weakness in leadership should at least lead to a continuing process of self-reflection, improved self-awareness and self-correction.

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Political risk

In present think tanks has been brought forward by different stakeholders, the impressions that society itself is on a drift and that it seems that the democratic set of tools is running out of its ability to control. In the outcome and result of many elections and referenda it more and more becomes evident that the drift in risks, for society in public risks, finds ground in political leadership and hereto related components. Reflecting on risk leadership brings us automatically from the academic and management domain in the direction of politics.

According Niccolò Machiavelli politics is the world of mainly that of power and influence. Is then politics one of the key drivers of public risk itself? Is the quest of risk leadership in fact all about the risk of politics or political risk? It is possible. Zooming in a bit more here. What is political risk? Matthee (2011) defines it as follows:

‘Political risk is a type of risk faced by investors, corporations, and governments that political decisions, events, or conditions will significantly affect the profitability of a business actor or the expected value of a given economic action.’ 

In a broader definition also citizens and communities should find resort in this definition. Anyway, politics is an obvious dimension that brings harm. An important aspect to build in the new program of Professor Peter Young. It leads in my view to the conclusion that risk leadership at least needs to embrace itself and for its practical applicability and use has to be upgraded, maybe even reconsidered, redefined, re-invented or re-engineered. In the public domain of day to day business and government, it means that this attitude of self reflection needs be applied to every elected and governing council, the place where politics actually emerge.

It has become clear from the European UDITE and PRIMO network that many city managers express the general feeling – from extensive experience with society, citizens, clients, investors, businesses, NGO’s and media – that this unpredictable working of politics has become a critical factor and express that the system of democracy itself is under pressure.

The unpredictable working of politics has become a critical factor

What is leadership if “democracy is the worst form of government, except for all the others.” (Churchill). What is in perspective of the emerging public risks in fact the ability of democracy? Gore (2009) reflected as follows:

”It is now apparent that the climate crisis is posing an unprecedented threat… to our assumptions about the ability of democracy and capitalism to recognize this threat for what it is and respond…”.

These doubts in and lack of trust in de governing system, where leaders live, form the background for a further reflection on leadership, especially when it concerns risks for citizens, society and nature.

Stewardship

Discussing the major public risks within the European network of public leaders the main concept for leadership that addresses and mitigates is felt in the form of stewardship, not (only) in the religious way but as a form that has a true holistic approach. We remember here the great Alexander von Humboldt and his holistic approach over the borders of sciences in the early 19^th century. He essentially connected sciences and approaches and with that crossed the lines of segmentation of opinions and views into a true ecological approach of areas and topics. Could his approach be a starting point for a more successful approach of public leadership, connecting vertically detail with headline, strategy with implementation and horizontally all relevant stakeholders. This way of perception could be beneficial and a great asset for modern leaders.

Alexander von Humboldt connected sciences… and with that crossed the lines of segmentation

Elaborate a little bit more on Von Humboldt. To be able seeing things as one and interconnected is the capacity of true ‘reflection’ needed, i.e. the capacity zooming out and seeing the larger picture, in connecting the dots. Like Alexander von Humboldt did in his 1858 masterwork (Cosmos part I). He for the first time in history connected the different sciences of the living and non-living world. He concluded: “Physical geography…, elevated to a higher point of view, … embraces the sphere of organic life…”. That was a great discovery and a major lesson to be able to connect the dots.

On governing cities and regions this reflection can be of great advantage in diagnosing the problem and define actions. Reflection is needed to get the bigger picture of things, people and happenings and to develop a sabbatical and clear view how to lead. It helps leaders getting the bigger picture, see more sharply the connection of elements within the public domain and thereby contribute to better decision making and putting things in perspective.

Change

From the network of PRIMO comes the experience that most of the public risks emerge from firstly lack of reflection capacity by leaders and with that insufficient diagnoses causes ineffective decisions. Only 12% of policies leads to implementation and from this only 25% is effective. Secondly lack of good working interfaces between stakeholders caused by a lack of binding leadership and thirdly by what can be defined as responsible-in-the-end leadership, i.e. stewardship. The last being an ethic that embodies the responsible planning and management of resources.

The concept of Risk Leadership can be possibly enriched with key leader capacities of reflection, connection and stewardship. In my view these can contribute to the reduction of risks, caused by leaders themselves and improve the quality of public and private governance and management in general. The initiative of Risk Leadership by the St. Thomas University could not have been timed better in this timeframe of changing paradigms, drifting societies and on a large scale emerging public risks. It is time for change.

Bibliography

Gore, A. (2009) Our Choice: Changing the way we think. Emmaus, US: Rodale Books.

Matthee, H. (2011) ‘Political risk analysis’ in Badie, B., Berg-Schlosser, D., & Morlino, L. (eds.), International encyclopedia of political science (pp. 2011-2014). Thousand Oaks, CA: SAGE Publications Inc. doi:10.4135/9781412959636.n457