As defined in 2007 by the inventor of the theory, the renowned Lebanese researcher Nassim Taleb, a “Black Swan” is an unlikely occurrence that takes us by surprise and has a major impact for society.
By way of examples of “Black Swans” we have, amongst many others, the outbreak of the 1st World War, Hitler’s rise to power in Germany, or more recently the attack on the Twin Towers in New York City on September 11 2001.
According to Mr. Taleb, all “Black Swans” must have these three attributes:
- Be highly improbable
- Have a severe impact upon Society
- Be predictable, retrospectively
Clearly, on the above bases, a loss event is not a “Black Swan” for companies. The occurrence of a pandemic, an explosion or a fire in an oil rig or refinery… is not an unlikely and unpredictable event. They have happened before and they will happen again in the future.
Hence the importance, and particularly in a hard market situation such as the current one, of investing in and improving upon the safety and risk prevention of companies since this is the best way of avoiding – or at the very least – of reducing the likelihood of any accidents occurring. It has been proven that most of the claims that occur in industries are caused by a “human factor”; or in other words, they are due to negligence on the part of their own or subcontracted employees. Consequently, it is essential that the training of workers be improved upon and that the officers of the companies take on board the importance of complying with the safety regulations they have established.
There is no point whatsoever in organising training courses and seminars and implementing rules and regulations if afterwards these are not obeyed and the offenders are not penalised for their negligence and carelessness. But it is still strange how the Works Councils of the industries that ought to be the most concerned about the safety of their workers, protest whenever the companies try to penalise those culprits who caused the accidents.
For those of us who know how companies in Latin American and English-speaking countries operate, it does not go unnoticed how these latter are the strictest in enforcing compliance with the safety rules on the part of their personnel, which results in those countries having a lower claims ratio.