What is Disaster Risk Reduction and Why is it Important

the riskmethods Blog

In observance of International Day for Disaster Risk Reduction, we explore the relationship between disaster, hazard, exposure, and vulnerability. We also suggest how you can reduce disaster risk, and all types of risk, in your supply chain.

1. What is disaster risk reduction?

By definition, a disaster is a sudden event that causes great harm and destruction of property. Disaster risk reduction (DRR) is taking steps to lower the potential for disaster by analyzing and managing the causes. Countries, organizations, and individuals all develop strategies to reduce the risk of disaster should adverse events strike.

In truth, “natural disasters” are natural hazards that result in great injury and damage. Natural hazards (such as extreme weather, wildfires, or earthquakes) may be inevitable, but disasters – loss of life and high economic costs – are not. This is why disaster risk reduction is important. It lowers the probability that a hazard or man-made event has disastrous consequences.


2. How do you measure disaster risk?

Measuring disaster risk involves evaluating the three components of disaster:

  • Hazard (a natural, technical, or man-made threat to people, property, or the environment)
  • Exposure (how likely that the hazard will occur). This includes an estimate of its severity and frequency.
  • Vulnerability (how susceptible people, property, or the environment are)

So to measure disaster risk, you estimate the probability of hazard, assess the exposure of specific risk objects, and you calculate their vulnerability. Some events have low probability, such as volcanos, but high impact. In addition, disaster risk can increase or decrease. Disaster risk is complex and continually changing, influenced by factors such as climate change or economics.

3. How do you reduce disaster risk?

According to the UN Global Assessment Report on Disaster Risk Reduction 2019 (GAR), “You need accurate, robust and real-time data to guide activities to reduce disaster risk.” Using data-based analysis enables countries and companies to better understand hazards. And such analysis shows how hazards link to exposure and to vulnerability, and provide a clearer picture of risk.


In a supply chain context, how can enterprises collect robust, relevant, reliable, and real-time risk data? By using AI-powered technology to identify where the risks are hiding. Gaining visibility beyond tier 1 is also critical. With The riskmethods SolutionTM, you can map out the locations of your suppliers, along with any supply paths. This enables you to visualize the interconnections between hazard, exposure, and vulnerability within your supply network.

Moreover, working with leading third parties of structured risk information, we provide a holistic view of risk from multiple sources to triangulate information from local, national, and international news sources. Our early weather warnings on extreme weather detail the path and projected time of landfall of tropical cyclones, for example. Advance notifications such as these give your organization time to contact suppliers, or begin proactive mitigation efforts.

4. What are disaster risk reduction strategies?

Having robust data supports risk analysis. A disaster risk reduction strategy relies on having the capability to anticipate hazard events, and includes the following additional components:


Disaster management outlines how to prepare and respond to disasters.

Disaster preparedness in enterprises includes contingency plans that detail who does what in an emergency. Typically, such plans contain disaster recovery for IT-infrastructure, for example.

Disaster readiness are measures that speed up response.

Disaster response is the reaction in an emergency. Such emergency management is also preceded by planning, so that it can begin immediately at the onset of the hazard event.

One example of a disaster risk reduction strategy for business is fire prevention. Taking steps to reduce the risk of fire in the first place is key to reducing disaster losses.

5. Why disaster risk reduction is everyone’s business

Across the world, societies and organizations endorse humanitarian disaster risk reduction. The objective is to install measures for risk analysis, disaster mitigation, and preparedness to protect civil society and invest in capacity building, particularly in less developed economies.

At the same time, many high-value assets, such as oil refineries, are located in hazard areas. Such assets are also threatened by climate change and extreme weather events. One example was the flooding in Europe this past July, which caused loss of lives and livelihoods. Criticism arose that local disaster preparedness, including hazard early-warning systems, was insufficient.

6. International Day for Disaster Risk Reduction

The International Day for Disaster Reduction takes place October 13. This year, it focuses on international cooperation for developing countries to reduce their disaster risk and disaster losses. Four pillars of disaster risk reduction are key to any program:

  • Understanding disaster risk
  • Strengthening disaster risk governance
  • Enhancing disaster preparedness
  • Investing in disaster risk reduction for resilience

Adopted by the United Nations in 2015, the Sendai framework for disaster risk reduction is a 15-year global agreement to reduce, prevent, and respond to disaster risks across the globe. And financing disaster risk reduction yields economic, social, and environmental benefits many times the investment. Without action, the impact and cost of disasters will continue to rise.


7. Disaster risk reduction vs. disaster risk management

While disaster risk reduction assesses the causes, disaster risk management (DRM) goes further. It focuses on implementing disaster risk reduction programs. It prescribes the actions and describes the activities needed to lower disaster risk.

And disaster risk management is not just for the public sector. It belongs in the toolbox of organizations everywhere. By managing disaster risk, indeed all types of risk, companies reduce uncertainty, limit their losses, and secure business continuity, and build resilience.

8. Disaster risk reduction and resilience

When it comes to your supply chain, the best way to build resilience is to gain a total view of risk. Our AI-powered threat detection of natural hazard risks includes earthquakes, extratropical storms, flash floods, hailstorms, river floods, storm surges, tornados, tropical cyclones, tsunamis, volcanos, and wildfires. Our monitoring also includes threats arising from financial, cyber, reputational, geopolitical, and man-made risk.

With The riskmethods Solution, you:

  • Reduce existing risk Map critical suppliers and supply paths to visualize hot spots
  • Address risk drivers Uncover single-source situations, or supplier clusters to make better decisions
  • Prevent new disaster risks Collaborate with suppliers to stay ahead of risk
  • Manage residual risk Assess the impact of risk that is unavoidable and reduce financial consequences.

Disaster risk reduction is everyone's business. Through comprehensive supply chain management, your business can reduce disaster risk, as well as other types of risk, for greater resilience.

Be prepared for every kind of disaster

Request a free demo to see how the riskmethods Solution will help you in reducing a disaster risk!
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