Integrating Resilience into Risk Matrices: A Practical Approach to Risk Assessment with Empirical Analysis

Abstract

The changing and intensifying landscape of global, national, and local disaster risks, driven by socio-political, environmental, and technological shifts, underscores the critical need for risk assessment by international agencies and governments. The Risk Matrix, introduced in 1995, has been widely used for risk assessment in different contexts, lauded for its simplicity and effectiveness. This model relies on the core risk components of consequence and likelihood, making it a favored tool for risk managers. To enhance the precision of risk assessment, various adaptations and extensions of the risk matrix have emerged; while some indirectly address resilience aspects, none explicitly integrate resilience into the matrix. This paper explores the risk matrix and its extensions, advocating for the inclusion of resilience in risk assessment. It introduces an empirical approach to quantify resilience, through a survey targeting small and medium-sized businesses in Southern Ontario, Canada. By developing two types of risk matrices—one with resilience considerations and one without—our work demonstrates how resilience alters risk prioritization, highlighting the importance of preparedness. This research underscores the pivotal role of resilience in risk assessment and urges its explicit integration into risk matrices to enhance accuracy and efficacy. Through practical examples and empirical data, the paper builds a compelling case for the central role of resilience in modern risk assessment practices.