Good piece in the latest issue of Operational Risk & Regulation on managing physical security risk. A quote:

Companies operating in dangerous places need to have structures in place to ensure business continuity. According to Adrian Stones, a director at Alaco, the London-based business consultancy: “It is absolutely critical to understand the landscape in which your company operates. You should have access to current information on the local politics, rule of law, civil society and potential flash points. A company that is not working off an accurate set of data will be caught out. There is no good reason for management not to be well-informed.”

Stones cites some of the largest companies that hire sociologists, geographers and political analysts to work up studies on countries they intend to move into. “Events change extremely quickly, as we saw in the Arab Spring. You need to be able to hit ‘refresh’ fairly regularly.”
The value of this approach is only now dawning on some companies that have relocated facilities or established sites in emerging markets. Melvin Glapion, the London-based head of business intelligence at security specialist Kroll, says companies fail in many instances to take security risks into account. “Energy companies with long experience of operating in dangerous places are on top of the problems. But [some senior management] might not understand the risks. The economics might look exciting, for example, in China or Russia. But have they thought through how their executives are going to get safely to work, day after day? Companies at headquarters level need to devise systems to which their staff on the ground adhere.”

Read more: http://www.risk.net/operational-risk-and-regulation/feature/2139184/operational-risk-dangerous-regions/page/1#ixzz1mva6tC6y

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Posted by Carlos Alvarenga

Carlos Alvarenga is the Executive Director of World 50 ThinkLabs and an Adjunct Professor at the University of Maryland's Smith School of Business.

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