BE SOMEWHAT AFRAID
Despite the hype over a potential avian flu outbreak, companies are doing
little to prepare.
By Tom Leander

Like a monster movie in which it takes forever for the evil spawn to reveal itself, avian flu may well emerge in a final reel to wreak havoc. Companies, at any rate, cannot count on a red herring. The World Bank estimates economic impact of US$800 bn if the pandemic goes person-to-person with anything like the fluidity of its distant 1918 relative, which killed more people than the then-closing World War I.

Despite general concern, companies by and large have not translated their concern into general preparedness, according to a study launched by Mercer Human Resource Consulting. Rosaline Chow Koo, regional business leader of Mercer’s Health & Benefits Asia unit, says: “Countries that endured SARS in 2003 are more advanced in pandemic planning.” She adds: “But in those nations that escaped the effects, such as the US, planning is in relative infancy.”

The gulf between concern and action is wide. Some 90% of the 450 respondents from 38 countries and 26 industries forecast high to moderate impact due to high absenteeism associated with a pandemic, but only 47% of the respondents have established a business-continuity plan. Almost 70% of organizations responded that a pandemic will have a negative impact on profits. But only 17% have allocated a budget to deal with pandemic preparedness. Perhaps the most surprising finding of the survey, according to Koo, was that 29% of the Chinese respondents set aside a budget to deal with the costs of a pandemic. This outpaced Singapore, at 22%, and Hong Kong – the hardest hit by SARS – at 17%. Koo surmises that the reason for Chinese preparedness stems from a desire to avoid the lack of response that characterized the SARS crisis, which caused a political uproar. Among the respondents were company risk-management officials from manufacturing, financial services, computers services, and insurance, and included such companies as Tianjin Jin Mei Beverage Company, Nike, Nokia, and New York Life. Reacting to the survey, Ryad Dahbi, risk management head, Hong Kong, and Avian Flu Taskforce Head, Asia, for Marsh, the risk and insurance specialist, said: “Many companies probably don’t realize that a sound contingency plan will offer a strategic advantage. You can react quicker and recover faster.”