Understanding and mitigating the risks associated with international travel
| Risk management | |
|---|---|
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| Authors | |
| The ANVIL Group |
Introduction
For many businesses today, the increasingly global nature of commerce is providing unprecedented opportunities to take advantage of international trading relationships. More and more companies are establishing international operations for sales, manufacturing, distribution and other key functions.
The saturation of traditional markets in Europe, North America and Australia is taking companies to new frontiers in more risky markets, such as Africa, Asia, Latin America and the Middle East, and new forms of accountability, such as Corporate Governance and Corporate Social Responsibility, are a recognition of the fact that corporate decisions are of public interest and put added pressure on companies to match their words with deeds, wherever they are operating.
Corporate Governance Codes can be found in more than 70 countries. The OECD, World Bank and International Monetary Fund have produced their own guidelines, and there has been a steady succession of committees and reports in the UK, the most notable of which – Internal Control: Guidance to Directors (formerly known as the Turnbull Guidance) – sets out best practice on risk management and internal control for UK listed companies, and assists them in applying the relevant section of the UK Corporate Governance Code.
Travel is an operational risk, and developing a dedicated, fully mapped travel risk management strategy is extremely important in understanding and mitigating risks for both travelling employees and their employers. For the employee, travel is inherently risky, because it places them in unfamiliar and/or disadvantageous environments. For the employer, if a traveller comes to harm, they face potentially severe consequences both legally and financially, as well as to their reputation. What is more, risks will continue to grow as companies increasingly globalise their operations.
In addition to having a good understanding of the political, economic and regulatory environments of the countries where employees will be deployed, corporations should implement a comprehensive travel risk management programme to understand and deal with the risks faced by business travellers. In this respect, using the services of a travel risk management specialist is recommended, as they offer ways to consolidate many of the tasks associated with ensuring employee safety.
When dealing with operational risk mitigation, controls should be implemented to mitigate risks from factors such as crime, civil unrest, extreme climate, natural disaster, emergency health and a lack of familiarity with the operating environment. Specific mitigation measures to protect personnel vary depending on the threat environment of the country; therefore seeking the advice of travel security consultants with proven expertise is strongly advised.
As companies become increasingly aware of the interdependence between security risks and operating practices, security and corporate governance have converged. The role of a security department is to help the company to take risks rather than eliminate them, and to have contingencies in place to minimise damage when things go wrong. Risk-taking is essential to successful business and corporate security departments should contribute towards the company’s goals.
Security departments can play a more proactive role by taking the lead on risk management and implementing processes and practices that encourage business development in an integrated way.
Managing security within a governance framework has also been helpful in achieving compliance from colleagues and visibility across the company. In addition, ratings agencies are beginning to evaluate companies’ risk management performance on behalf of investors.
Travel Risk Management has assumed increased importance as an employer’s duty of care towards employees is expected to become increasingly enshrined in punitive legislation.
Security issues, legislation around employee health and safety, as well as a company’s duty of care for general employee wellbeing call for organisations to have robust processes and policies in place.
When discussing safety and security, the focus tends to be on the most prominent issues such as natural disasters, terror incidents and kidnapping. Less dramatic, but far more frequent, are issues like car accidents and medical incidents abroad. The broader notion of traveller wellbeing and duty of care issues are not only linked to emergencies and medical incidents. The stress of business travel caused by delays, lost baggage, less productivity (yet consistently high workload) or the simple fact of being away from friends and family should not be underestimated.
Policy and planning
Development of a Travel Safety Policy linked to other corporate policies is critical to safeguard not only your employees, but also your business profitability and reputation. The policy will ensure a consistent company-wide approach to travel security and meet with legal and regulatory obligations. Companies should take an integrated approach to developing the policy by involving the correct stakeholders from various departments, including security, travel, HR, legal, occupational health, insurance and events; and obtain board level buy-in to ensure compliance.
The policy should identify the range of potential risks to business travellers and detail the agreed processes to mitigate and monitor those risks. Clear and consistent means to deliver assistance in response to an incident should also be provided.
Consideration should be given to the scope of the policy, i.e. should it cover all business-related travel whether domestic or international? Will the policy apply to employees only or their families too if travelling on company business?
You may wish to mandate that all employees book their travel and accommodation through designated travel management companies, which are already acquainted with approved airlines, hotels and ground transportation providers, deemed safe for use by the employer. Travellers should also be required to provide their direct contact information, as the travel booker’s contact information is no use in a crisis or major security event.
List high-risk countries and destinations where authorisation from senior management is required before travel, and specify that the travel management company is not allowed to issue tickets until travel is approved.
Content should also be created around the additional risks faced by lone or female travellers. You should stipulate how many employees or board members can travel together on a scheduled flight, known as an accumulation risk.
You may wish to make travellers aware of insurance policy requirements and benefit limits, as there could be exclusions in relation to pre-existing medical conditions.
Planning is essential to identify and assess the risks associated with travel, though it is not enough to simply write an Incident Management Plan; it should be rehearsed and continually reviewed for its effectiveness. The plan should clearly set out a crisis management framework that details the agreed tools for mitigation, responsibilities for action and means for evaluating the measures taken.
Training
Wherever they are travelling, offering employees greater awareness of the threats and hazards they could encounter inspires confidence and will give them the assurance they need to conduct business safely anywhere in the world. Even experienced travellers should be reminded regularly of the risks they face.
Training should be provided with a view towards preventing an incident from occurring, as well as protection from and response to an incident. Training can range from raising general travel safety awareness and educating the traveller on the cultural, social and legal standards at the destination, to preparation for entry to high-risk or hostile environments.
Monitoring
Monitoring traveller movements and emerging threats, and being able to communicate quickly and easily with the traveller are also key to a successful travel risk management programme.
Response
If employees require medical or security assistance whilst travelling, they should know who to contact for immediate support. Your company’s business travel and accident insurance policy may cover the costs, but insurance companies alone are not generally geared up to manage assistance cases 24/7.
Contracting with an international assistance company will provide your travellers with access to highly trained and experienced case managers who will use an established global network of medical and security providers to deliver a range of services, including arranging appointments with doctors, clinics and hospitals, medication replacements or prescription transfers. They will also be able to assist during security emergencies, for instance if a traveller has been arrested or detained, become a victim of crime or been caught up in a public disturbance.
If the situation turns critical, emergency response teams can be deployed to facilitate medical or security evacuations or repatriations from poor standard hospitals or volatile environments to neighbouring centres of medical excellence and safe havens, or even to the traveller’s home country.
