For engineers & risk experts, risk is the product of the likelihood and magnitude of harm. • Engineers & risk experts have traditionally identified harms & benefits with factors that are relatively easily quantified, such as economic losses and loss of life. • In a new version of the way engineers and risk experts deal with risk, the ‘‘capabilities’’ approach focuses on the effects of risks and disasters on the capabilities of people to live the kinds of lives they value. • The public conceptualizes risk in a different way from engineers and risk experts, taking account of such factors as free and informed consent to risk and whether risk is justly distributed. • Government regulators have a different approach to risk because they place more weight on avoiding harm to the public than producing good. • Engineers have techniques for estimating the causes and likelihood of harm, but their effectiveness is limited. • Engineers must protect themselves from unjust liability for harm to risk while also protecting the public from risk. 

The Engineer’s Approach to Risk • To assess a risk, an engineer must first identify it. To identify a risk, an engineer must first know what a risk is? • Risk is the product of the likelihood and the magnitude of harm. • The engineering conception of risk contains no implicit evaluation of whether a risk is morally acceptable. • Utilitarianism holds that an acceptable risk is one in which the product of the probability & magnitude of the harm is equaled or exceeded by the product of the probability and magnitude of the benefit, and there is no other option where the product of the probability & magnitude of the benefit is substantially greater. Cost-Benefit analysis may be used. 

Utilitarian Acceptable Risk Limitations • It may not be possible to anticipate all of the effects associated with each option. Insofar as this cannot be done, the cost–benefit method will yield unreliable results. • It is not always easy to translate all of the risks and benefits into monetary terms. • What monetary value that should be placed on human life? • The cost–benefit analysis in its usual applications makes no allowance for the distribution of costs and benefits. • The cost–benefit analysis gives no place for informed consent to the risks imposed by technology. 

The Capabilities Approach to Risk • Philosopher Colleen Murphy and engineer Paolo Gardoni have developed a capabilities-based approach to risk analysis, which focuses on the effect of disasters on overall human well-being. • Well-being is defined in terms of individual capabilities, or the ability of people to lead the kind of life they have reason to value. • Specific capabilities are defined in terms of functionings, or what an individual can do or become in his or her life that is of value. Examples of functionings are being alive, being healthy and being sheltered.

A capability is the real freedom of individuals to achieve a functioning and it refers to the real options.