Fusing strategic risk and futures methods to inform long-term strategic planning: case of water utilities.

Risks and futures methods have complementary strengths as tools for managing strategic decisions under uncertainty. When combined, these tools increase organisational competency to evaluate and manage long-term risks, improving the flexibility and agility of the organisation to deal with gross uncertainties. Here, we set out a framework to guide the assessment of strategic risks for long-term business planning, based on its application at Portugal's largest water utility, Empresa Portuguesa das Águas Livres. Our approach extends strategic risk assessment by incorporating scenario planning-a futures approach used to help the utility move beyond single point forecast of risks to focus on critical dimensions of uncertainty that are fundamental to the resilience of corporate objectives and their vulnerability to external pressures. We demonstrate how we combine two complementary approaches-risk and futures-and use them to assess (i) how a set of baseline strategic risks for a water utility evolves under alternative futures, (ii) the aggregate corporate-level risk exposure, and (iii) the process and responses needed to manage multiple, interdependent strategic risks. The framework offers a corporate approach to evolving strategic risks and improves a utility's (i) knowledge of uncertainties, (ii) ability to assess the impacts of external developments over long time horizons and the consequences of actions and (iii) degree of flexibility to adapt to possible future challenges. The framework supports risk managers in their long-term strategic planning, through the appraisal and management of multiple, interdependent long-term strategic risks and can be replicated in other organisational contexts to bridge operational and corporate perspectives of enterprise risk.

Risk assessments for quality-assured, source-segregated composts and anaerobic digestates for a circular bioeconomy in the UK.

A circular economy relies on demonstrating the quality and environmental safety of wastes that are recovered and reused as products. Policy-level risk assessments, using generalised exposure scenarios, and informed by stakeholder communities have been used to appraise the acceptability of necessary changes to legislation, allowing wastes to be valued, reused and marketed. Through an extensive risk assessment exercise, summarised in this paper, we explore the burden of proof required to offer safety assurance to consumer and brand-sensitive food sectors in light of attempts to declassify, as wastes, quality-assured, source-segregated compost and anaerobic digestate products in the United Kingdom. We report the residual microbiological and chemical risks estimated for both products in land application scenarios and discuss these in the context of an emerging UK bioeconomy worth £52bn per annum. Using plausible worst case assumptions, as demanded by the quality food sector, risk estimates and hazard quotients were estimated to be low or negligible. For example, the human health risk of E. coli 0157 illness from exposure to microbial residuals in quality-assured composts, through a ready-to-eat vegetable consumption exposure route, was estimated at ~10-8 per person per annum. For anaerobic digestion residues, 7 × 10-3cases of E. coli 0157 were estimated per annum, a potential contribution of 0.0007% of total UK cases. Hazard quotients for potential chemical contaminants in both products were insufficient in magnitude to merit detailed quantitative risk assessments. Stakeholder engagement and expert review was also a substantive feature of this study. We conclude that quality-assured, source-segregated products applied to land, under UK quality protocols and waste processing standards, pose negligible risks to human, animal, environmental and crop receptors, providing that risk management controls set within the standards and protocols are adhered to.

Environmental regulation in transition: Policy officials' views of regulatory instruments and their mapping to environmental risks.

This study re-analysed 14 semi-structured interviews with policy officials from the UK Department for Environment, Food and Rural Affairs (Defra) to explore the use of a variety of regulatory instruments and different levels of risk across 14 policy domains and 18 separately named risks. Interviews took place within a policy environment of a better regulation agenda and of broader regulatory reform. Of 619 (n) coded references to 5 categories of regulatory instrument, 'command and control' regulation (n = 257) and support mechanisms (n = 118) dominated the discussions, with a preference for 'command and control' cited in 8 of the policy domains. A framing analysis revealed officials' views on instrument effectiveness, including for sub-categories of the 5 key instruments. Views were mixed, though notably positive for economic instruments including taxation, fiscal instruments and information provision. An overlap analysis explored officials' mapping of public environmental risks to instrument types suited to their management. While officials frequently cite risk concepts generally within discussions, the extent of overlap for risks of specific significance was low across all risks. Only 'command and control' was mapped to risks of moderate significance in likelihood and impact severity. These results show that policy makers still prefer 'command and control' approaches when a certainty of outcome is sought and that alternative means are sought for lower risk situations. The detailed reasons for selection, including the mapping of certain instruments to specific risk characteristics, is still developing.

Appraising longitudinal trends in the strategic risks cited by risk managers in the international water utility sector, 2005-2015.

We report dynamic changes in the priorities for strategic risks faced by international water utilities over a 10year period, as cited by managers responsible for managing them. A content analysis of interviews with three cohorts of risk managers in the water sector was undertaken. Interviews probed the focus risk managers' were giving to strategic risks within utilities, as well as specific questions on risk analysis tools (2005); risk management cultures (2011) and the integration of risk management with corporate decision-making (2015). The coding frequency of strategic (business, enterprise, corporate) risk terms from 18 structured interviews (2005) and 28 semi-structured interviews (12 in 2011; 16 in 2015) was used to appraise changes in the perceived importance of strategic risks within the sector. The aggregated coding frequency across the study period, and changes in the frequency of strategic risks cited at three interview periods identified infrastructure assets as the most significant risk over the period and suggests an emergence of extrinsic risk over time. Extended interviews with three utility risk managers (2016) from the UK, Canada and the US were then used to contextualise the findings. This research supports the ongoing focus on infrastructure resilience and the increasing prevalence of extrinsic risk within the water sector, as reported by the insurance sector and by water research organisations. The extended interviews provided insight into how strategic risks are now driving the implementation agenda within utilities, and into how utilities can secure tangible business value from proactive risk governance. Strategic external risks affecting the sector are on the rise, involve more players and are less controllable from within a utility's own organisational boundaries. Proportionate risk management processes and structures provide oversight and assurance, whilst allowing a focus on the tangible business value that comes from managing strategic risks well.

Towards a Transferable UAV-Based Framework for River Hydromorphological Characterization.

The multiple protocols that have been developed to characterize river hydromorphology, partly in response to legislative drivers such as the European Union Water Framework Directive (EU WFD), make the comparison of results obtained in different countries challenging. Recent studies have analyzed the comparability of existing methods, with remote sensing based approaches being proposed as a potential means of harmonizing hydromorphological characterization protocols. However, the resolution achieved by remote sensing products may not be sufficient to assess some of the key hydromorphological features that are required to allow an accurate characterization. Methodologies based on high resolution aerial photography taken from Unmanned Aerial Vehicles (UAVs) have been proposed by several authors as potential approaches to overcome these limitations. Here, we explore the applicability of an existing UAV based framework for hydromorphological characterization to three different fluvial settings representing some of the distinct ecoregions defined by the WFD geographical intercalibration groups (GIGs). The framework is based on the automated recognition of hydromorphological features via tested and validated Artificial Neural Networks (ANNs). Results show that the framework is transferable to the Central-Baltic and Mediterranean GIGs with accuracies in feature identification above 70%. Accuracies of 50% are achieved when the framework is implemented in the Very Large Rivers GIG. The framework successfully identified vegetation, deep water, shallow water, riffles, side bars and shadows for the majority of the reaches. However, further algorithm development is required to ensure a wider range of features (e.g., chutes, structures and erosion) are accurately identified. This study also highlights the need to develop an objective and fit for purpose hydromorphological characterization framework to be adopted within all EU member states to facilitate comparison of results.