Protect Your Business from Disasters: Simple Steps for Resilience

1. Simple steps to protect your business from disastersUlanbaataar, Mongolia31 March 2017

2. I. How disaster proof is your business? 10 key questionsII. The growing threat of disaster riskII. Business continuity planning paysIV. 12 Steps to protect your business Outline of sessions

3. Session I. How disaster proof is your business • The walk of resilience • A quick self-assessment

4. The Walk of Resilience 1. Ismy business located in an area exposed and vulnerable to floods, cyclones & other hazards? Yes/No 2. Would a direct hit from a hazard, ie flood or cyclone, close my business? Yes/No 3. Does my business have a continuity plan? Yes/No 4. Does my business have back-up systems (ie IT or alternative premises) it can use in case of a disaster? Yes/No 5. Is my business insured against disaster losses? Yes/No

5. The Walk of Resilience 6. Does my business have an alternative key supplier ready if a disaster closes the current one? Yes/No 7. Are my local and national authorities prepared for floods & other hazards? Yes/No 8. Would my business suffer if public utilities such as roads, power and water were cut?Yes/No 9. Does my business see DRR as a business opportunity? Yes/No 10. Will my business consider disaster risk in future operational and investment decisions? Yes/No

6. A more detailed self-assessment Let’s look at the same questions in more detail; Please look at the self-assessment grid that you have received

7. Self-assessment rating This is: A simple benchmark of your business & disaster risk Not a score to rate whether your business is good or bad Your total 10: Need to strengthen awareness/action on disaster risk 11-20: Emerging awareness/action on disaster risk 21-30: Strengthening awareness/action on disaster risk 31-40: Disaster risk being managed well

8. The growing threat of disaster risk Session II.

9. More disasters Disaster occurrence in Asia and the Pacific (Source: EM-DAT)

10. Disasters are costing more Economic and human losses in Asia and the Pacific (Source: EM-DAT)

11. Asia Pacific business agrees Allianz Business Risk Barometer 2017 • Business interruption, supply chain risk • Market developments (volatility & competition) • Natural catastrophes • Cyber incidents • Fire, explosion • Macro-economic developments (inflation) • Changes in legislation & regulation • Loss of reputation & brand value • New technology disruption • Human error

12. The ‘new normal’ means greater risk • Businesses continues to be located in highly-exposed locations (Thai floods) • Risk is more complex & inter-connected – EQ in Japan closes car factories around the world • Once hit, it’s hard to recover – Kobe port after 1995 EQ; 10 months after 2011 EQ in Japan one-third of SMEs still not restarted business

13. Impact on unprepared business UNISDR-PWC survey of 1,200 enterprises in the Americas found fewer than 15% of firms with less than 100 employees had a business continuity plan 2011 Christchurch NZ EQ: 97% of all affected enterprises were SMEs & 14 months after EQ 37% SMEs still reported reduced revenues 2011 Japan EQ: 10 months after the disaster one-third of SMEs had still not restarted business; Damage to Renesas microchip maker in Japan led to 150,000 fewer Toyotas being made in US & the company losing $1.2bn globally

14. Business continuity planning pays Session III.

15. Why BCP …. • It’s the cheapest form of insurance for your business • It saves you money & helps your business recover quickly if hit by disaster • It protects your business’s assets, operation and reputation • It makes businesses think about taking disaster risk management more seriously ie investment policy • It makes enterprises see the value of working with the public sector to protect the ‘lifelines’ of business

16. It protects your business & its reputation 75% of companies without BCPs fail within three years of a disaster A year after Hurricane Sandy all the businesses on this NYC street were still closed … apart from one bar Let’s share one example of how BCP works

17. Common BCP principles • Avoid risk:ie pull out of hazardous locations; refuse to work with suppliers who are not ‘resilient’ • Reduce risk:ie upgrade existing infrastructure • Share risk:ie insure assets, hedge risks, contractual agreements • Accept risk: ie business accepts zero risk is impossible and agrees to accept residual risk after above measures

18. It helps your business recover quickly The day after the 2011 EQ multiple logistics routes were secured & 400 workers from non-hit areas were brought in to help All 10 supermarkets in Tohoku supplied by Seven & I Holdings Co. Ltd reopened (Ishinomaki reopened the same day) Company’s distribution firm revised its contingency plan seven times since 1995 Kobe EQ Local store managers had authority to reopen quickly

19. 12 steps to protect your business Session IV.

20. 12 steps to protect your business BCPs come in many forms but most include the following elements • Assess your risk (look at past experience) • Assess your critical business functions • Review planned investments for disaster risk • Invest beyond codes • Prepare your supply chain • Create an emergency management plan for your employees

21. 12 steps to protect your business 7. Back up your computer data 8. Create a crisis communications plan 9. Assemble emergency supply kit (incl records & cash) 10. Review your insurance coverage 11. Plan for an alternative locations 12. Exercise your plan – write it down and test it

22. Group work Let’s go through the 12 steps together to see which steps your business can take now? Of the steps you cannot take now – discuss in groups which are the most important and how you could take these steps in future

23. I Thank you