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Risk-based Oversight (RBO): A way of performing oversight, where:
- planning is driven by the combination of risk profile and safety performance; and
- execution focuses on the management of risk, in addition to ensuring compliance.
Risk Profile: The elements of risk that are inherent to the nature and the operations of the regulated entity, this includes:
- the specific nature of the organization/operator;
- the complexity of its activities;
the risks stemming from the activities carried out.
Safety Performance: The demonstration of how effectively can a regulated entity (e.g. operator) mitigate its risks, substantiated through the proven ability to:
- comply with the applicable requirements;
- implement and maintain effective safety management;
- identify and manage safety risks;
- achieve and maintain safe operations;
the results of past certification and/or oversight also need to be taken into account.
EASA explains the relationship between Performance-based Oversight (PBO) and Risk-based Oversight (RBO) as:
- The concept of "performance" conveys the idea of tangibly measuring the health of the system under scrutiny and ultimately assessing its overall performance. Performance indicators, as a means to measure, may specifically help to either identify risks within that system or measure safety risks or monitoring actions mitigating these risks. This means that a PBO can also support the identification of areas of greater risk and serve the risk assessment and mitigation exercise. This is where PBO meets RBO. 
The implementation of Safety Management Systems signals a shift from reactive and compliance based oversight to a new model that includes proactive and performance-based tools and methods.
Recognising that compliance alone cannot assure safe operations, and that effective and affordable regulatory oversight needs to be targeted, most regulators have altered the relationship between the operators and the Competent Authorities to ensure that greater oversight is applied to those that need it. To achieve this, Inspectors need to be able to assess safety performance and the key factors that influence it. If an Operator's Compliance Monitoring Function demonstrates that regulatory and procedural compliance is being monitored effectively internally then it will attract less external oversight.
A risk-based approach to oversight entails the assessment of the performance influencing factors, organisational changes and other safety performance indicators that make up an operator's risk profile. An operator's risk profile will inevitably be dynamic. The regulator must have a process that acquires and analyses different sources of intelligence that provide insight into the changing risks in an operation such as:
- reported occurrences;
- reorganisation and restructuring (e.g new management and reporting structures, new operating bases, new aircraft types, changing working practices);
- retirement/departure of a key employee (e.g new accountable manager, safety manager, or operations director);
- financial health of the organisation;
Those operators with a high-performing SMS and clear safety leadership will attract less oversight.
Accidents and Incidents
The following events in the SKYbrary database of Accident and Incident reports feature Ineffective Regulatory Oversight as a contributory factor:
- B737, New York La Guardia USA, 2016 (On 27 October 2016, a Boeing 737-700 crew made a late touchdown on the runway at La Guardia and did not then stop before reaching the end of the runway and entered - and exited the side of - the EMAS before stopping. The Investigation concluded that the overrun was the consequence of a failure to go around when this was clearly necessary after a mishandled touchdown and that the Captain's lack of command authority and a lack of appropriate crew training provided by the Operator to support flight crew decision making had contributed to the failure to go around.)
- ATP, Vilhelmina Sweden, 2016 (On 6 April 2016, a BAe ATP partly left the side of the runway soon after touchdown, regaining it after 155 metres before completing its landing roll. It sustained damage rendering it unfit to continue flying but this was not noticed until five further flights had been made. Investigation attributed the excursion to lack of pilot response to unexpected beta range power and the continued flying to the aircraft Captain's failure to ensure proper event recording, accurate operator notification or a post-excursion engineering inspection of the aircraft. Systemic inadequacy in safety management and culture at the operator was identified.)
- E190, Kupang Indonesia, 2015 (On 21 December 2015, an Embraer 195 crew continued a significantly unstable approach which included prolonged repetition of 'High Speed' and a series of EGPWS Alerts which were both ignored and which culminated in a high speed late touchdown which ended in a 200 metre overrun. The Investigation attributed the event to poor flight management and noted the systemic lack of any effective oversight of pilot operating standards compounded in the investigated event by the effects of a steep flight deck authority gradient and the failure to detect anomalies in the normal operating behaviour of both the pilots involved.)
- H25B, vicinity Akron OH USA, 2015 (On 10 November 2015, the crew of an HS 125 lost control of their aircraft during an unstabilised non-precision approach to Akron when descent was continued below Minimum Descent Altitude without the prescribed visual reference. The airspeed decayed significantly below minimum safe so that a low level aerodynamic stall resulted from which recovery was not achieved. All nine occupants died when it hit an apartment block but nobody on the ground was injured. The Investigation faulted crew flight management and its context - a dysfunctional Operator and inadequate FAA oversight of both its pilot training programme and flight operations.)
- B739, Yogyakarta Indonesia, 2015 (On 6 November 2015, a Boeing 737-900 overran the 2,200 metre-long landing runway at Yogyakarta after a tailwind approach with airspeed significantly above the applicable Vref followed by a long landing on a wet runway without optimum use of deceleration devices. The flight crew management of the situation once the aircraft had come to a stop was contrary to procedures in a number of important respects. The aircraft operator took extensive action to improve crew performance following the event. The Investigation found significant fault with the airport operator's awareness of runway surface condition and an absence of related significant risk management.)
- B743, vicinity Tehran Mehrabad Iran, 2015 (On 15 October 2015 a Boeing 747-300 experienced significant vibration from one of the engines almost immediately after take-off from Tehran Mehrabad. After the climb out was continued without reducing the affected engine thrust an uncontained failure followed 3 minutes later. The ejected debris caused the almost simultaneous failure of the No 4 engine, loss of multiple hydraulic systems and all the fuel from one wing tank. The Investigation attributed the vibration to the Operator's continued use of the engine without relevant Airworthiness Directive action and the subsequent failure to continued operation of the engine after its onset.)
- HUNT, manoeuvring, vicinity Shoreham UK, 2015 (On 22 August 2015 the pilot of a civil-operated Hawker Hunter carrying out a flying display sequence at Shoreham failed to complete a loop and partial roll manoeuvre and the aircraft crashed into road traffic unrelated to the airshow and exploded causing multiple third party fatalities and injuries. The Investigation found that the pilot had failed to enter the manoeuvre correctly and then failed to abandon it when it should have been evident that it could not be completed. It was concluded that the wider context for the accident was inadequate regulatory oversight of UK civil air display flying risk management.)
- A320, Halifax NS Canada, 2015 (On 29 March 2015, an Airbus A320 crew mismanaged the descent during a night non-precision approach at Halifax and continued below MDA without the mandatory autopilot disconnection until, with inadequate visual reference, the aircraft impacted terrain and obstructions 225 metres short of the runway. The aircraft was destroyed but there were no fatalities. The Investigation found that the crew did not monitor their descent against the required vertical profile, as there was no SOP requiring them to do so, and did not recognise in time that a go around was appropriate.)
- DH8D, Hubli India, 2015 (On 8 March 2015, directional control of a Bombardier DHC 8-400 which had just completed a normal approach and landing was lost and the aircraft departed the side of the runway following the collapse of both the left main and nose landing gear assemblies. The Investigation found that after being allowed to drift to the side of the runway without corrective action, the previously airworthy aircraft had hit a non-frangible edge light and the left main gear and then the nose landing gear had collapsed with a complete loss of directional control. The aircraft had then exited the side of the runway sustaining further damage.)
- AT76, vicinity Taipei Songshan Taiwan, 2015 (On 4 February 2015, a TransAsia Airways ATR 72-600 crashed into the Keelung River in central Taipei shortly after taking off from nearby Songshan Airport after the crew mishandled a fault on one engine by shutting down the other in error. They did not realise this until recovery from loss of control due to a stall was no longer possible. The Investigation found that the initial engine fault occurred before getting airborne and should have led to a low-speed rejected take-off. Failure to follow SOPs and deficiencies in those procedures were identified as causal.)
- A320, en-route Karimata Strait Indonesia, 2014 (On 28 December 2014, an A320 crew took unapproved action in response to a repeating system caution shortly after levelling at FL320. The unexpected consequences degraded the flight control system and obliged manual control. Gross mishandling followed which led to a stall, descent at a high rate and sea surface impact with a 20º pitch attitude and a 50º angle of attack four minutes later. The Investigation noted the accident origin as a repetitive minor system fault but demonstrated that the subsequent loss of control followed a combination of explicitly inappropriate pilot action and the absence of appropriate pilot action.)
- GLF3, Biggin Hill UK, 2014 (On 24 November 2014, the crew of a privately-operated Gulfstream III carrying five passengers inadvertently commenced take off at night in poor visibility when aligned with the runway edge instead of the runway centreline. When the aircraft partially exited the paved surface, the take-off was rejected but not before the aircraft had sustained substantial damage which put it beyond economic repair. The Investigation found that chart and AIP information on the taxiway/runway transition made when lining up was conducive to error and that environmental cues, indicating the aircraft was in the wrong place to begin take-off, were weak.)
- … further results
- Predictive Risk Management
- Safety Accountabilities and Responsibilities
- Just Culture
- Safety Oversight
- EASA: Practices for risk-based oversight; Edition 1, EASA, published 22 November 2016.
- UK CAA: CAP1092: Strategic Plan 2011-16, updated June 2014