As multinational organizations continue to expand into developing markets, they are recognizing the need for advanced systems to monitor and protect globally mobile employees. With new risks emerging every day, when was the last time you evaluated your company’s travel-risk and crisis-management programs?
Imagine it’s 3 a.m. and your phone rings. Your company’s chief operating officer wants to know how many employees are presently in Cairo, the site of one of your key trading partners. You flip on the news to see images of burning cars and the newscaster describing a civil uprising that has turned violent.
For human resource directors, this scenario and others like it have played out many times over the past decade. Whether it is civil unrest in North Africa, tsunamis in Asia, terror attacks in Europe or other globally significant events, international risks today are more prevalent than ever before. Despite these threats, U.S. businesses continue to expand into overseas markets. According to the U.S. Department of Commerce’s Bureau of Economic Analysis, 22.9 million Americans work for a U.S.-owned multinational corporation (MNC). These workers may potentially travel or be permanently assigned to an international location for business purposes. To manage duty-of-care obligations, effective human capital management requires the analysis, management and mitigation of the risks involved with this exposure.
Understanding International Risks
Devastating events affecting international travelers and those working in different countries are daily occurrences, with new threats rapidly outpacing traditional safety and security measures:
- Natural disasters are increasing. The Centre for Research on the Epidemiology of Disasters has documented a sixfold increase in reported natural disasters from 1975 to 2011.
- Pandemic diseases are on the rise. The World Health Organization is tracking rapidly communicable diseases such as avian influenza (H7N9), pandemic flu (H1N1) and the Middle East respiratory syndrome, coronavirus (MERS).
- Terrorism continues to be a threat. The Central Intelligence Agency reports “attacks are likely to expand increasingly to include U.S. companies and American citizens,” particularly in the Middle East and Southwest Asia. Since 2001, there have been more than 65,000 noncombatant deaths due to terrorism worldwide.
- Medical care internationally is variable. The Centers for Disease Control and Prevention (CDC) states that medical care is frequently lacking abroad, and in many countries there are significant concerns regarding counterfeit pharmaceuticals and blood safety.
With all of these potential risks, how can human resource teams help prepare employees for international emergencies?
Integrated Travel Risk and Crisis Management
To meet duty-of-care obligations, forward-thinking organizations are proactive about preparing for these evolving international threats. They recognize the potential impact to travelers, expatriates, third-country nationals, local nationals, subcontractors, vendors and clients. To address this, MNCs must take an integrated enterprisewide approach to travel risk and crisis management.
Too often, corporations unknowingly take unnecessary risks by purchasing a patchwork of travel-assistance solutions. Typically, these products are selected not for their crisis response capabilities but because they are attached to insurance programs that protect against economic hazards. Although these assistance programs can be beneficial for the traveler who needs a prescription refilled or help locating replacement eyeglasses, they prove ineffective during major events such as the Arab Spring. This exposes the employee to possibly preventable harm, the corporation to unanticipated liability and the business’s operations to potential interruption. Unfortunately, a check-the-box travel-assistance solution that is not integrated with a corporation’s emergency-action plans doesn’t solve this problem.
One solution is to create an integrated travel risk and crisis management program that requires an alignment of internal stakeholders and external resources. Internally, organizations must create a cross-functional, cross-departmental task force for the program that is charged with actively assessing the company’s evolving international risk and regularly reviewing employees’ and administrators’ roles and responsibilities during an emergency. The task force should have representatives from all departments responsible for protecting personnel, including human resources, risk management, security, legal, occupational health and travel.
One of the task force’s first responsibilities should be to examine the company’s existing travel risk and crisis management framework for areas of potential alignment. Multinational corporations often have overlapping service packages from various vendors sponsored by different departments, such as employee benefits and business insurance. Prudent organizations can use these programs to save money and streamline vendor management.
Enterprisewide travel risk and crisis management programs provide the highest likelihood of positive outcomes in emergencies. Corporations that implement comprehensive programs will see decreased financial exposure, reduced organizational liability and higher levels of employee safety. Furthermore, there is evidence of a measurable financial return on investment: A recent report published by the Business Council for the United Nations noted that for every dollar spent on risk mitigation and crisis response, the average return on investment during an emergency is between $4 and $11. Because emergencies are continuing to occur frequently, this return is often quickly realized.
By creating a complete travel risk and crisis management program, requiring both internal and external integration, multinational corporations help meet their duty-of-care requirements, reduce their financial and legal liability, and demonstrate their commitment to employees by providing them with the highest levels of protection possible. They also dramatically improve their business operations’ resiliency during major crises.
Melissa Roth is vice president and general counsel and Stephanie Diamond is senior manager, Human Capital Management, at Global Rescue LLC, a provider of worldwide emergency services and crisis response.
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