Eleven billion dollars. That’s the estimated cost to businesses and the economy in 2003, when China, Hong Kong and Singapore bore the brunt of the SARS (severe acute respiratory syndrome) epidemic. Schools and some workplaces were closed, tourist arrivals plummeted and consumer confidence was dented.
Now comes the highly contagious Ebola virus, which causes a deadly hemorrhagic fever that has killed more than 840 people so far in 2014. The fatality rate varies from 50% to 90%, much higher than SARS’ 9.6%. The Ebola epidemic has been contained to West Africa and its spread to Asia is considered remote – for now.
“With cross-border travelling increasing, there is a potential for transmission [of the Ebola virus] around the world”
Still, “it’s never too early to prepare for the worst,” stressed Adeel Naeem, a Senior Risk Consultant at Aon Risk Solutions. “Good governance and proactive risk and business continuity management entails pre-planning for pandemics, as their spread is generally unpredictable.”
But it seems that, their SARS experience notwithstanding, few companies in Asia are ready with a contingency plan. A Singapore-based CFO of an international hotel group told CFO Innovation that finance needs to budget for additional expenses should a work-from-home arrangement be required, but conceded that his team has not done any work on it.
Despite the emergence of work-from-home schemes and mobility solutions in the enterprise, this CFO does not feel companies are much better prepared for a potential pandemic today compared to 2003.
Indeed, a survey last month of 189 multinational companies by ECA International, a consulting firm that assists companies with the management of international assignees around the world, found that 50% of companies currently have no policy in place for dealing with a pandemic.
“That half of the companies we surveyed have no policy in place is rather surprisingly,” says Lee Quane, the company’s Regional Director for Asia. “With cross-border travelling increasing, there is a potential for transmission around the world.”
“Multinational organizations have a responsibility to be prepared for such events and every good business continuity plan should have measures tin place to deal with this kind of risk,” he adds.
An outbreak in Asia cannot be ruled out. In July, a woman in Hong Kong was isolated in the city’s Queen Elizabeth hospital after doctors suspected she might have caught the virus after a trip to Africa.
Late last month, authorities in Vietnam and Myanmar tested three patients for the virus when they exhibited symptoms after a trip to Africa. All four tested negative.
How then, should CFOs and their companies react should pandemic management measures be implemented by governments and subsequent business continuity plans become necessary?
Of the companies in the ECA survey that did have policies in place, the two most common aspects were the provision of a safe working environment and a business continuity plan that would kick in if employees are no longer able to travel to work.
Three quarters of companies with policies in place said they were ready to return any expatriate staff, if possible, and/or their families should a pandemic occur.
Only a very small number of companies reported being willing to increase hardship allowances (4%), or provide a new exceptional allowance (5%).
"In a pandemic situation, there will be issues specific to expatriates," says Quane. "Global mobility teams need to ensure that these are also addressed within any crisis policy so that everyone is prepared and responsibilities clear.”
“Considerations include how to deal with the expatriate’s family, knowing who to contact and how to reach people far from HQ, as well as defining how much more care, if any, is reasonable to give to expatriates than to locally employed staff."
Unless it is business-critical, consider curtailing travel to affected locations (in Guinea, Liberia, Sierra Leone and Nigeria, at this point)
Companies surveyed that have staff in West Africa appeared to mostly be content with monitoring the situation (74%). But almost 20% were restricting movement in and out of the region, and 23% restricted movement within the region.
Specific containment measures would differ based on the nature of the disease, but social distancing is a key factor to take into consideration while planning for catastrophes, says Aon’s Naeem.
This would entail splitting up of key staff, using remote access and work from home options and also to activate the recovery sites which can be used to deploy resources.
“Companies should consider whether their IT infrastructure is robust enough to support such strategies and this should be well thought through and tested in advance,” he adds.
ECA International recommends companies take expatriates into consideration while monitoring government warnings and feedback from people on the ground. The consulting firm also suggests working with specialist providers such as International SOS to help with policy.
When you have to travel
For its part, Marsh Risk Consulting counsels individuals, including business travelers, to consider the following:
- Monitor developments via the websites of the World Health Organization, Centers for Disease Control, your national health authority, and local health authorities.
- Educate yourself and colleagues about Ebola’s transmission and infection-control measures.
- Consider curtailing travel to affected locations (in Guinea, Liberia, Sierra Leone and Nigeria, at this point), unless it is business-critical
- Reconsider your itinerary or plans if you are ill immediately prior to your travel dates.
- Avoid high-risk activities such as contact with ill people or the bodies of people who have died from Ebola, with sick or dead wildlife, or with bushmeat (meat from wild mammals).
- Pay strict attention to hygiene. Frequently wash your hands or use hand sanitizer, avoid touching your face, and avoid close contact with an obviously sick person.
- Be aware that screening and isolation measures are already or may be put into place, particularly following WHO’s recommendation that countries affected by Ebola conduct exit screenings at international airports, seaports, and land crossings. Any travelers suspected of being sick or in contact with an infected person could be quarantined.
- Avoid medical facilities that treat Ebola cases. Be aware that If you get sick in any affected country and have symptoms similar to Ebola (i.e., malaria), it may prove more difficult than usual to travel regionally or internationally for medical treatment.
- Seek medical attention if you feel sick (i.e., fever, headache, achiness, sore throat, diarrhea, vomiting, stomach pain, rash, or red eyes) when traveling to a suspect area or if you come in contact with a suspect person or contaminated object.
About the Author
Melissa Chua is a Singapore-based Contributing Editor at CFO Innovation.