021 March 2022

Ten measures companies need to take to tackle a pandemic (part 2)

6. Develop solutions to compliance and customer relationship maintenance risks arising from the inability to resume production at short notice

In the aftermath of a health emergency, organisations must work closely with customers to understand the changes in the market and the impact of resuming business,

In addition, it is important to thoroughly analyse contracts, as, due to the exceptional causes and laws issued during the crisis period, breaches of contract may not have legal consequences.

Companies should identify and assess contracts whose performance may be affected, promptly notify customers to mitigate potential losses and assess whether a new contract or additional clauses need to be signed. It is important to generate and retain all documentary evidence for use in potential civil claims.

7. Social responsibility and sustainable development strategies in decision-making

The publication of adequate corporate information on the crisis can improve a company’s public image.

It is necessary to be able to implement corporate social responsibility from the perspectives of the environment, society, the economy and employee stability, as well as to coordinate relations with the community and supply companies. The potential impact and duration of the epidemic must be assessed, plans adjusted and, at the shareholder or board level, the proposed measures and their results communicated.

8. Develop a plan for managing employee data, information security and privacy

Companies should establish employee data management mechanisms and register internal and external staff, suppliers and other employees with whom the organisation has contact.

Information security emergency response plans also need to be formulated to ensure information security and stability of operations. Protocols must be in place to secure the operation of networks, systems and applications.

It is essential to protect both customers’ and employees’ personal and data privacy. In the case of clinical and medical data, access control and an appropriate level of protection must be established as required by regulation.

9. Companies should consider adapting their budgets and implementation plans

We advise companies to pay particular attention to cash flow to ensure the security of funds in accordance with the rhythm of suppliers and employees’ work plans.

In addition, special attention should be paid to the international import and export trade situation, particularly sudden changes or possible impacts on the places of origin of the main products, which could lead to considerable losses in the company itself. To avoid such incidents, companies need to establish different scenarios that include the responses that would be carried out in these situations, such as contingency plans for core suppliers, alternative suppliers and consideration of alternative means of transport.

10. Update the company’s risk management mechanisms

According to Deloitte’s Enterprise Risk Management survey, 76% of risk managers believe that their company could respond effectively if a major emergency occurs tomorrow. However, only 49% of companies have developed relevant manuals and pre-tested based on emergency scenarios. Furthermore, only 32% of companies have conducted emergency simulation exercises for each scenario.

Most companies are exposed to different types of crises due to unexpected risks at any time. Therefore, it is essential to establish or improve their risk management systems to identify risks and develop a mitigation plan.

Strengthening the risk management system is as important as dealing with negative events when they occur.