Environmental risk assessment of industrial facilities: techniques, regulatory initiatives and insurance

Most companies that manufacture, handle or dispose of chemicals or petroleum products have the potential to cause environmental impairment, especially by longterm or gradual release of materials into the environment. This impairment creates potential liabilities that result from numerous regulations as well as from common law. One way to identify these potential environmental liabilities and exposures is through environmental risk assessment. The primary focus of an environmental risk assessment is to evaluate the potential for off-site gradual impairment arising from a company's operations. Such an assessment reviews the status of the firm's environmental risk exposure and is a useful internal tool for corporate planning. There are three major objectives in performing an environmental risk assessment: risk identification, risk evaluation and risk reduction. To identify risk, numerous criteria are used to determine the individual factors contributing to the potential for off-site exposure. The interaction of these individual risk factors is then used to evaluate the overall potential for gradual environmental impairment. After the risks have been evaluated, recommendations are made to reduce the potential exposures. In addition, implementation of risk reduction strategies accomplish the objective of legislative initiatives for protecting human health and the environment. Environmental risk management can and should be encouraged through legislative initiatives.