Would you climb Mount Everest?  

Tony Jaques writes about how organisations often ignore warning signs of risk, unlike individuals, whose personal choices only endanger themselves.


Image by Prabin Sunar | Pexels

Every year, an average of around eight people with a lot of money and an overblown view of their own ability die trying to climb Mount Everest. In last year’s climbing season, more than 800 hopefuls paid a small fortune to line up and take the same risk.

And just last week, almost 1,000 Mount Everest trekkers had to be rescued from a sudden fatal snowstorm, many of them lacking the most basic protective clothing for adventuring at high altitudes in extreme cold.

Every individual has their own appetite for risk – such as people who go bungy jumping, or swimming with sharks, or even climbing the world’s highest peak.

Corporations and other organisations need to have a clear risk appetite too, with managers alert for warnings and red flags because, for them, it isn’t – or shouldn’t be – a decision just about individual risk.

There is no more vivid example than the implosion of the deep-sea submersible Titan on a voyage to the Titanic in 2023.  

The just-released US Coast Guard final report into the needless disaster reinforced that the CEO of OceanGate arrogantly ignored repeated safety warnings and presided over a toxic work environment in which only his opinion mattered.

The CEO told one critic five years earlier that he was ‘tired of industry players who try to use a safety argument to stop innovation’ and that ‘we have heard the baseless cries of ‘you are going to kill someone’ way too often.’ His attitude led directly to his own death and the death of four thrill-seeking passengers, as well as the destruction of his company. 

Not every case of corporate risk-taking is so blatant, yet seemingly responsible organisations continue to ignore, or fail to see, or wilfully disregard, the warning signs of risk which precede so many crises. As the American scholars Erika James and Lynn Wooten have said: “Smouldering crises nearly always leave a trail of red flags and warning signs that something is wrong. These signals often go unheeded by management.”

While individuals can suffer the consequences of their personal risk appetite, when corporations make judgement calls about risk and ignore red flags, it is usually the employees, not the managers, who suffer.

Consider the famous Beaconsfield gold mine disaster in Tasmania, which became a worldwide television sensation following the almost miraculous rescue of two survivors trapped by a roof collapse. The subsequent coroner's inquiry concluded that a history of previous rockfalls showed it was glaringly obvious that the roof support system in the mine was totally inadequate.  

Or when an AirAsia Airbus crashed into the sea off Indonesia, and the cause was human error triggered by a maintenance fault which had occurred 23 times in the previous 12 months. Little wonder the BBC called the official report: “Anatomy of an avoidable crash.”

Or the fatal gas explosion at New Zealand’s Pike River coal mine, with 29 killed. In the previous seven weeks there had been 21 reports of gas build-up to dangerous levels and a further 27 incidents of lesser gas build-up, including on the day of the explosion.

Not every risk leads to an organisational crisis, but every crisis creates some type of risk, be it financial, operational, environmental or reputational. Most importantly, the great majority of crises come after red flags and warning signs about the potential hazard.

Climbers on Mount Everest know and consciously accept their own personal risks and occasionally walk right past the frozen bodies of those who died in the attempt.

However, when it comes to organisational risk, sometimes the warning signs of a potential crisis are known and ignored, and innocent people lose their lives or their livelihoods.