Environmental risk assessments almost always depend on expert judgement. In risk assessments, it is important to consider what the stakeholders and experts stand to gain or lose. It is also wise to consider what the person performing the analysis stands to gain or lose.

For example, there was a terrible accident in Thredbo, Australia in 1997 in which part of a hill subsided, demolishing two ski lodges and killing 18 people (Figure 4.1). Some of the people living in lodges adjacent to those that subsided assessed the risk and decided to remain. In doing so, they disagreed with an assessment by consulting geologists and engineers that concluded many lodges (including theirs) were at ‘high risk’ of slippage because of swamp deposits, high water tables and significant surface water flow. The report went on to say that sites at ‘very high risk’ showed evidence of soil creep and signs of past instability.

Consider the positions of the people for the period between the accident and the completion of engineering works. Lodge owners lose income unnecessarily if they decide the site is unsafe and close their lodges, and it turns out to be safe. The consulting engineers damage their professional reputation and incur substantial costs if they conclude the site is safe, and later it subsides. For both parties, wrong assessments result in considerable personal costs. The consulting engineers cannot benefit substantially from an assessment that concludes the site is safe. The lodge owner may.