SERIES: Your Perspective on Risk - Part 2: Risk Perception

Henrik Merkelsen from the Copenhagen Business School in Denmark provides a view into the usage of the word "risk" in contemporary English language.  I noted in Part 1 of this series that risks are managed according to cultural perceptions: If risk is described by a culture as a danger or hazard, the culture is risk-averse, and the management of an organization within that culture sees risk as something to be avoided or mitigated.

This is the second part of a series on differing perspectives of risk between and within cultures.  The posts in this series are based on a small section of my doctoral dissertation.* You can find Part 1 by scrolling down below this blog entry or clicking here.

Scenario - What do you see? 

What do you envision when you see read the following scenario?**  

Noah sits under a boulder that may (or may not) dislodge from a ledge above him. 

Do you see:

• That Noah was placed under a boulder?
• The boulder's potential to dislodge and fall on Noah?
• Noah places himself under a boulder?

Your answer to that question determines whether you have the tendencies to take risks or to avoid them.  Interestingly, your answer will also reflect the culture in which you matured.  If you manage risk capital in a company or if you regulate a certain industry, your viewpoints will show up in your capital requirements.

* Risk Culture and Its Influence on Firm Value and Performance [© Tara Heusé Skinner, 2016, International School of Management, Paris].
**Adapted from Merkelsen, H. (2011). The constitutive element of probabilistic agency in risk: a semantic analysis of risk, danger, chance, and hazard. Journal of Risk Research, 14(7), 881-897.