Two years into the COVID-19 pandemic, corporate leaders worldwide are trying to figure out how to navigate a dramatically transformed threat landscape with the goal of returning their business operations, safely, to some semblance of normalcy. Regional conflicts are unfolding, crime is at record levels, natural disasters are more frequent and destructive, supply chains have been disrupted, and the prospect of new variants of the coronavirus has created uncertainty about when a return to normal might be possible.
Global Guardian hosted a webinar on February 16 in which experts examined the top five threats facing business operations today and offered suggestions for how disruption caused by these threats can be mitigated. The top five threats identified were: regional conflicts, cybersecurity, natural disasters, health and medical, and violent crime.
“Rarely do these risks appear in the world in isolation,” said Cheryl Steele, vice president of Global Security & Resilience (CSO) at Starbucks Coffee Company. “In the real world, the disruptions… most often happen where risks intersect. In other words, those events that are likely to have the biggest impact on a business are likely to trigger risks across multiple [areas]: cyber may trigger data privacy which may impact brand reputation; a natural disaster will impact supply chains which then impacts operations.”
As such, Steele said, “it is incredibly important, particularly when it comes to preparedness, that we spend time thinking about how the worst thing that might happen would actually happen, and who would need to be involved in helping respond.” Resiliency, she explained, has three parts: prepare, respond, and recover.
"Resiliency has three parts: prepare, respond, and recover."
“And that’s regardless of the risk that materializes,” she added. At Starbucks, Steele oversees safety and security operations, including executive protection, physical security infrastructure, occupational health and safety, supply chain security, global intelligence and business resiliency.
A Look at the Threats
Most of the world’s attention is currently focused on the Russian invasion of Ukraine and the potential for conflict with the West. However, there are many other global hot spots, including Ethiopia, Syria, Afghanistan, and the South China Sea, where China’s provocative actions toward Taiwan threaten to destabilize the region.
“Regional conflicts have come roaring back,” said Global Guardian CEO Dale Buckner, noting that some conflicts had paused as a consequence of the pandemic.
Mitigating the risks: Michael Ballard, director of intelligence at Global Guardian, said that when looking at conflict zones, companies need to consider the impact that conflict can have on surrounding areas as well, what he described as second and third-order effects. He recalled the downing of Malaysian Airlines Flight 17 over Ukraine in 2014. All 283 passengers and 15 crew were killed when the commercial aircraft was struck by a surface-to-air missile launched from pro-Russian separatist-controlled territory in eastern Ukraine.
A conflict can pose risks to air traffic, but also result in flight disruptions and shut down airspace causing travelers to become stranded. “When you are looking at some of these conflict zones, if you have operations or personnel [in those locations], you want to think about having contingency plans to get out,” said Ballard.
Ransomware attacks have grown exponentially over the past couple of years causing huge losses to businesses. Buckner said that since 2019, Global Guardian has seen a steady increase in requests for cybersecurity assistance. He attributed this in part to the fact that the pandemic has forced workers worldwide to work from home, often on inadequately protected networks.
Mitigating the risks: Buckner recommends companies practice diligence when it comes to their cyber policies. “If 30 percent of your workforce is never going to come back to the office, are you supporting that dispersed workforce properly from a pure cyber side,” Buckner asked. “There is no one-button solution for cyber. It is multilevel.”
At Starbucks, Steele said, company leaders have been “very intentional” about reminding employees about processes of data privacy and providing guideposts. With so many employees working from home in the company of family members, she said, employees need to know how and when to safeguard business-sensitive information.
Buckner said people can reduce their exposure to cybercrime by ensuring the security of their computer and router, for example. “Is your connection back into your firm encrypted,” he asked. If employees are unsure, they should ask the IT staff at their company for help. “You need to raise your hands and ask those very basic questions of what should you be doing and are you executing those very basic steps to try and protect yourself and the firm,” he added.
A warming planet is fueling extreme weather events. Natural disasters have grown more frequent, ferocious, and destructive. The 2021 Atlantic hurricane season, for example, will likely go down as the most expensive in history having caused billions of dollars in damage. In the Philippines, a Super Typhoon killed hundreds of people in December 2021. Glaciers are melting at rapid rates causing sea levels to rise. The National Oceanic and Atmospheric Administration (NOAA) predicts the sea levels along the coastal United States will rise by a foot or more on average by 2050—an increase in just 30 years that would match the increase during the 100 years from 1920 to 2020. Ice storms and wildfires are more frequent, and a deadly tornado season in the United States is showing signs of an early start. On the other extreme, the U.S. West coast is currently in the grip of a megadrought that has produced the driest two-decade period in at least 1,200 years.
“What is undeniable is that these events are bigger, more powerful, and having more effect than ever,” said Buckner. “There is no denying the facts of the powerful nature of these events.”
Mitigating the risks: Buckner said natural disasters, which will continue to disrupt travel, should be part of the calculus of corporate leaders looking to set up offices and even supply chains anywhere in the world, but particularly in areas prone to risk. “The big takeaway for firms is: What’s your future like?”
Health and Medical
Last summer, India’s health care system collapsed under the weight of the COVID-19 pandemic. Hospitals were overrun, doctors and nurses were in short supply, and lifesaving medicines and oxygen supplies ran out. “The Western insurance models failed because they tried to manage India with telemedicine,” said Buckner. In India, he explained, only licensed doctors who are present in the country can provide prescriptions. Through its on-the-ground networks, Global Guardian provided oxygen, prescriptions from local doctors, and even delivered groceries to its clients in India at the peak of the pandemic.
Mitigating the risks: As travel picks up, Buckner said companies should evaluate the type of duty of care they provide their employees and ask themselves if they are prepared to take on additional costs if employees fall sick while traveling on business. He cautioned that just because some countries are opening up, buoyed by high vaccination rates and low infection and death rates, does not mean the situation is the same in other parts of the world. In Hong Kong, for example, soaring COVID-19 infections have stretched the health care system to breaking point. “It’s going to affect your business and your people if you are operating [in Hong Kong],” said Buckner.
Rates of violent crime—murders, burglaries, car jackings, kidnappings—are at all-time highs. “If violent crime has spiked here in the U.S., the wealthiest country in the world, what do you think is happening in poorer parts of the world,” Buckner asked.
Ballard said that violent criminal gangs are being fueled by drug money, particularly in the United States—one of the world’s largest consumer of illegal drugs. Petty theft, too, has increased in the United States. This is having an impact on businesses. In San Francisco, for example, Walgreens has been forced to close several stores in response to what it described as “organized retail theft.”
“One doesn’t take on the role of being a CSO without employee safety being the top-of-mind issue,” said Steele. This concern, she said, extends to the safety of employees working in high-crime neighborhoods or dealing with customers with mental illness, as well as the safety of employees in countries where a company’s supply chains are located which may be affected by civil unrest or conflict.
Mitigating the risks: Ballard recommends keeping a low profile in high-crime areas and being hypervigilant about one’s surroundings. For those traveling in foreign countries, he said, “People think about executive security as a convoy of Suburbans. That is often the opposite of what you want to be doing.” In such circumstances, he said: “You want to just blend in, you don’t want to stand out because you may already stand out regardless just based on being a foreigner.”
The Pandemic’s Toll on Personal Resiliency
Steele discussed the decline in personal resilience that has been accelerated by the pandemic.
“There is no doubt that each of us and the employees that we are responsible for are at a new low in our personal resiliency,” she said. “This means that every new disruption might trigger a heightened reaction or response.”
She emphasized the importance of being self-aware of where one personally sits in this area of personal resilience. “As leaders, we need to make decisions and balance competing demands, often with the potential to impact many. We need to be incredibly reflective of how our own exhaustion might play out, and we need to make time to reset and recover,” she said. “Thankfully, collectively, we are more attuned to mental health… and making tremendous strides in reducing the stigma that is attached to that,” she added.
An Evolving Duty of Care
The strain of juggling the competing demands of home and work while working from home is taking a toll on some employees. Buckner emphasized the importance of companies extending duty of care to these employees, whether that is ensuring their personal safety or addressing mental health needs.
More and more employees, Steele said, are paying attention to their personal safety and expect to be supported by their employers. “This means that there is a changing landscape when it comes to the definition of and the expectations around duty of care,” she said. With large numbers of people working from home, Steele said these expectations can include issues like housing security and domestic violence, which employees previously may not have considered.
“If there is a COVID silver lining,” Steele said, “it is that it has accelerated the visibility and the value placed on resiliency and preparedness in the minds of everyone.” It has also changed how people think about risk, she added.
Steele sees risk in three dimensions: the probability, the velocity, and the impact. “That velocity and impact, that’s where you start seeing intersections across other types of risk. The speed at which it happens might trigger another risk. The degree of impact might drive velocity someplace else,” she explained.
In the face of such risks, Steele listed some top-of-mind concerns:
- Are we doing enough today to prepare for the risks that will materialize tomorrow?
- Are we asking ourselves the right questions?
- Are we challenging our assumptions?
- Are we putting ourselves through the tabletop exercises or scenario-driven assessments?
Steele acknowledged that achieving all of this can be incredibly difficult as it’s not just a matter of one team performing these actions, but rather “bringing together key cross-functional partners and risk owners from other parts of the business.”
As parts of the world begin to reopen, Buckner said corporate leaders have a “six-to-nine-month window” to make material changes to their duty of care platforms. Companies need to evaluate the performance of their insurance providers and vendors on the travel and medical sides.
If they have failed in the past, he said: “You have a choice: you can either force them to change and/or you can leave and make a change to firms that will support you in this new world.”
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