Insights on handling coronavirus from an earlier report on business and outbreaks
Publicado: 11 marzo 2020
Business action agenda
A cautionary tale
Businesses experience outbreaks through the effects on employees, suppliers and customers. This provides a framework for response.
Executives and boards can take several steps to reduce corporate and community exposure to infectious disease risk:
Clarify the scale and nature of the disease threats to the company:
- Monitor emerging threats actively through an appropriate risk surveillance platform.
- Incorporate data from such sources into company risk management and operational decision-making to ensure adaptive management of infectious disease risk.
- Understand how outbreak risks are tied to geography, and how those location-based risks intersect with critical business dependencies. These crucial overlaps can occur in operations and human resources, supply chains and sources of revenue. For example, are production facilities or an important natural resource concentrated in vulnerable regions?
- Consider a comprehensive audit of exposure and vulnerability to infectious disease threats throughout business functions. This audit should cover not only exposure to potential infectious disease disruptions, but also a review of likely commercial and economic effects of disruptions should they occur.
Reduce corporate exposure to critical outbreak risks:
- Address critical vulnerabilities and reduce risk exposure by actively monitoring threats, managing the supply chain and planning outbreak mitigation. Where appropriate, offload risk through appropriate insurance and by outsourcing to specialized risk management firms.
- Include a review of disruption from outbreaks as a business risk when procuring goods and services, and when developing strategic investments and partnerships.
Improve internal response capabilities:
- Develop and test pre-event response plans rigorously and systematically to minimize losses from a disruptive event.
- Develop appropriate employee sickness and remote working policies to protect the company’s workforce and productivity. Involve human resource, enterprise risk and corporate communications teams to develop and communicate clear plans for minimizing employee exposures to possible infection during outbreaks and for communicating these plans to employees. Plans should include consideration of medical interventions to protect employees, such as vaccinations, medications and hygienic practices. They should also cover policies that can reduce the spread of a disease through the workforce. Maintaining employee trust through competent, proactive risk management can help minimize inappropriate absenteeism, while also reducing the risk of contagion within companies.
- Prepare robust production and supply chain continuity plans that include first- and second-tier suppliers who may account for the company’s greatest commercial vulnerabilities. Engaging suppliers in frank but supportive discussions about their exposure to infectious disease risk can help foster relationships that improve business resilience to outbreaks.
- Develop pre-emptive contracting and capacity management plans for operational and logistic activities at high risk of disruption from an outbreak. Operational managers should be supported to help them understand their locale-specific outbreak risk and tasked to work with enterprise risk management teams to implement appropriate monitoring and mitigation activities.
- Identify key external dependencies important to the continued running of the business but that may be disrupted by an outbreak. Externally provided functions, such as public transport, childcare or food supply, may be unavailable during a severe outbreak. Developing plans for providing such functions during external failures can help companies avoid subsequent losses in productivity. Plans may benefit from a collaborative, preemptive agreement between businesses located in an at-risk area for procuring and providing essential external services. Participating in private-sector and industry-based groups can help with sharing best practice, developing collaborative response plans and providing a forum for collective engagement with governments to improve health security.
Communicate proactively to reduce the risk of overreaction:
- Most economic losses caused by infectious disease outbreaks result from the actions of uninfected individuals. They may take drastic action to protect themselves and their families when faced with fear, uncertainty and misinformation. To avoid contagion, customers, employees and partners may stay away from places of business. Such social avoidance, however, can significantly affect employee absence rates, operational productivity and demand. Transparent and timely communication regarding the nature of an outbreak, its effect on business functioning, and preparedness and response activities can help reduce the likelihood of panicked market responses. The development of such plans should be coordinated with public health and safety agencies wherever they are present and effective. In some localities, however, the private sector may need to lead on informing communities, including their own employees, on the nature of the outbreak threat and how to best ensure public safety.
Promote preparation through leadership and governance:
- Company boards can help managers stay ahead of infectious disease threats by raising awareness of the risk and reviewing corporate plans for risk mitigation and management. Helping businesses to focus on the changing nature of the infectious disease threat can protect shareholder value and promote social responsibility.