As a young captain in the Russian Ministry for Emergencies, Andrey Elokhin was dispatched to Chernobyl in 1986 in the aftermath of a disaster recognized today as the world's worst nuclear power plant accident.

Wearing a special detector to monitor radiation exposure, Mr. Elokhin spent two weeks at the Ukrainian nuclear plant after the accident, and he returned the next year to assist in efforts to secure the site. “No heroism,” says Mr. Elokhin, through a translator, adding that he prefers not to go into details, and promptly changes the subject.

He more eagerly reminisces about the perks he received with his old ministry identification card that, during tough times in the Soviet Union, enabled him to get special food products and buy vodka on state holidays.

But as a responder to one of the worst industrial catastrophes, it may be no coincidence that Mr. Elokhin has become one of Russia's foremost experts in industrial risks and safety.

In a country where operational risk management is given lower priority than managing financial and strategic risks, Mr. Elokhin is committed to developing a risk management culture in Russia, from government to private industry.

“Such a risk management culture is an essential element for creating a civil society,” he says.

In recognition of his work in the broader risk management community and as head of the insurance department at Moscow-based OAO LUKOIL, the largest private oil company in Russia, Mr. Elokhin was selected by a panel of experts as Business Insurance's European Risk Manager of the Year 2009.

In Russia, Mr. Elokhin is known for having, quite literally, written the book on industrial risk management.

Sitting in his Moscow office, Mr. Elokhin spreads out on a table a half-dozen books he's authored and co-authored. Among the titles: “Insurance of High Risk Industries: Some Engineering Aspects,” and “Analysis and Management of Risk: Theory and Practice,” which he says sold out in 2000 and required a second edition a couple of years later.

From his 15 years at the Scientific and Research Institute of the Russian Ministry for Emergencies, Mr. Elokhin also has hundreds of scientific papers and reports to his credit. In fact, he also helped write the country's industrial safety law in the mid-1990s, and continues to serve as a government adviser in the fields of industrial risk analysis and management, loss prevention and safety.

In 1997, Mr. Elokhin decided to switch from the public sector to the private sector, joining LUKOIL as chief of risk analysis at LUKOIL Insurance Group (see story, page 16).

“What I was doing (in the government sector) is I was creating modeling and theories of different events, but I was interested in how it would work in reality,” he explained.

After LUKOIL's insurance group was sold to Russian insurance and banking magnate Danil Khachaturov in 2003, Mr. Elokhin became head of the insurance department. And, as a risk and insurance manager, he has developed a program that has become a model for Russia's energy sector.

Of all the books Mr. Elokhin displays, he appears to derive particular satisfaction from two large spiral-bound binders that he did not pen directly: They are LUKOIL's latest risk engineering surveys from Suregrove Ltd., a Tadworth, England-based risk management and engineering consulting firm.

Under Mr. Elokhin's initiative, LUKOIL became the first energy company in the Russian market to produce detailed risk engineering and safety reports. The biannual reports track the progress of completing Suregrove's recommendations.

“LUKOIL basically has set the standard in terms of how the market sees the profile of the risk,” said Petr Sudoplatov, divisional director of industrial property and energy at Willis CIS in Moscow, part of Willis Group Holdings Ltd., one of LUKOIL's brokers. “Lots of other risk managers from other oil companies are coming to LUKOIL and asking, "What is the process?' or "How do you address these issues?'”

Page after page in Suregrove's report highlight recommendations the consultant has made for LUKOIL's refineries, petrochemical plants and other facilities, from installing firefighting equipment and automatic sprinkling systems to enhanced training programs.

Mr. Elokhin flips through the binders to show how many recommendations have written in bold type underneath, “Status: Closed.”

“These reports are welcomed and recognized by the market,” said Mr. Elokhin, and they have improved safety, reduced risk as well as contributed to steadily lower premium rates for LUKOIL.

“I asked our colleagues at ConocoPhillips (a Houston-based minority shareholder of LUKOIL) what percentage of their recommendations are implemented, and they believe 70% to 75% is a very good result. At LUKOIL, 88% of all recommendations have been implemented or are in the process of being implemented,” he adds.

Asked about his risk management philosophy and strategy, Mr. Elokhin begins by citing the Old Testament, which he says quotes perhaps humankind's first risk manager.

In Deuteronomy 22:8, Moses instructs the builders of a new house to put a “battlement” or parapet on the roof, “that thou bring not blood upon thine house, if any man fall from thence.”

But it is the 19th century Russian lexicographer, Vladimir Ivanovich Dal, whose magnum opus, an explanatory dictionary of the Russian language, has a definition of risk that is closest to Mr. Elokhin's. According to part of Mr. Dal's entry, risk is something “without exact calculations.”

“When we talk about risk management, the first thing we understand about it is that it is making decisions based on certain calculations,” said Mr. Elokhin. “So the philosophy is that our assessments and risk management is based on the detailed and exact calculation of the risk.”

As an academically trained mathematician with a doctorate in technical science, Mr. Elokhin values statistical data and models as he evaluates the insurance needs of LUKOIL and roughly 60 of its subsidiaries.

Risks not only are identified, they are calculated in their volume and exposure, he said.

And when he is dissatisfied with an accepted risk model, such as one well-known methodology that analyzed the explosion risk posed by petroleum vapors, Mr. Elokhin and his team simply came up with a better one on their own, he said.

But beyond handling the risks of LUKOIL's refineries and petroleum plants, Mr. Elokhin keeps his eye on the big picture.

Operational risk management still is very much an emerging discipline in Russia. Now more than ever, financial risk management is given a much higher priority at companies, followed by strategic risk management.

“Insurance and risk management are facing difficult times,” said Nadia Nosova, managing partner at Korna Risk Management in Moscow and a member of the Russian Risk Management Society who represents the organization on the board of the Federation of European Risk Management Assns. in Brussels.

In today's economic conditions, some insurance and risk managers are among those losing their jobs, she said.

Mr. Elokhin, through his work as a vp and founding member of the six-year-old RusRisk, tries to raise awareness of risk management at all levels, including in helping craft a letter from the society to Russian President Dmitry Medvedev in an effort to improve risk management at state-run companies (see related story, page 18).

He wants to see risk management improve on all levels of society, from businesses and industry to local and national government. “The more society is active on managing risks and emergencies, the faster the civil potential of the nation will grow,” he said.

Unfortunately, it sometimes takes an industrial tragedy to get the attention of government and business.

In August, a deadly explosion at Russia's largest hydroelectric power station killed 75 and led to a huge property loss. The disaster, Mr. Elokhin believes, finally may get people's attention about the need for risk management.

In that case, the estimated cost for reconstruction of the Siberian plant, which is operated by state-owned RusHydro, is $1.3 billion and the time frame is five years, according to Mr. Sudoplatov of Willis. The damage was only partially insured with a loss limit of $200 million, he said.

“We believe this is a huge loss which will definitely impact the pricing in the international market and in the international market for Russian risks. That means that we can talk a lot about the financial risks, strategic risks, but operational risks can be even more severe sometimes than others,” Mr. Sudoplatov said.

“This kind of accident may give a wake-up call for the development of risk management initiatives,” added Mr. Elokhin.

Ms. Nosova points to some positive developments. Some companies, she said, are recognizing the importance of risk management, and are starting to focus on technical measures, alternative risk transfer and multilayer coverage.

“We are all still learning our lessons after the financial crises but, no doubt, the true value of risk management is not going to vanish especially when this profession is represented by people as Mr. Elokhin,” she said.