Business Preparedness: A ‘Legal’ Umbrella to Keep You …€¦ · · 2011-07-11Sr. Management...
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Transcript of Business Preparedness: A ‘Legal’ Umbrella to Keep You …€¦ · · 2011-07-11Sr. Management...
Jay N. RosenblattPartner
Simpson Wigle LLPwww.simpsonwigle.com
Business Preparedness:
A ‘Legal’ Umbrella to Keep You Protected
Business Preparedness:
A ‘Legal’ Umbrella to Keep You Protected
16th World Conference on
Disaster Management
© Simpson Wigle LLP WCDM June 20, 2006: Ver. FINAL
Who We AreWho We Are
Simpson Wigle LLP:is a business law firm with offices in Hamilton & Burlington
Jay Rosenblatt:is a Business & Emergency Law Partner at the Firm, providing counsel & solutions to Businessfounder of the Golden Horseshoe Venture Forum (www.ghvf.org)
Business Preparedness:Outline
Convince you that with ANY Disruption/Disaster:Directors & Sr. Managers are at tremendous personal riskYour Business & all its Resources are also at tremendous riskYou SHOULD worryDue Diligence is a legal defenceThere ARE immediate actions that can be taken that will minimize risk to you & your BusinessThese actions MUST be taken
Business Preparedness:Emerging Trends & Issues
“E.M. & B.C. Working Together”Business Continuity v. Disaster RecoveryLow Frequency/High ImpactHigh Frequency/Low ImpactPersonal PreparednessEmployeesRegulatory ComplianceOutsourcing
Business Preparedness: Who Needs Protection
DirectorsSr. ManagementYour Business & its Resources:
PeopleProcessProductsOther resources
Business Preparedness:Legal Issues & Liabilities
BUSINESS CONTINUITY
Critical Business Functions
Contracts
OH&SAWS&IB
Negligence
C-45
Pandemics
Regulatory Compliance
EmploymentDisruptionDisaster
EmergencyPandemic
© Simpson Wigle LLP
Business Preparedness:NON-Legal & Liabilities
ShareholdersEmployeesSupply Chain Management (SCM)Investors/LendersReputation ManagementCompetitive AdvantageInsuranceProfitsExit Strategies (including going Public)New Opportunities
Business Preparedness:Risk & Opportunities
Opportunity is always present in the midst of crisis.
Every crisis carries two elements, danger and opportunity. No matter the difficulty of the circumstances, no matter how dangerous the situation.... At the heart of each crisis lies a tremendous opportunity.
Great Blessings lie ahead for the one who knows the secret of finding the opportunity within each crisis.
wisdom from the I-Ching, the ancient book of Chinese wisdom
Seeds of Wisdom
Business Preparedness:What, Me Worry!?
What, me worry!?“The nice thing about not planning is that failure
comes as a complete surprise and is not preceded by a long period of worry and stress!”
David Parsons (Sydney Water) & Sir John Harvey-Jones
The only thing harder than planning for an emergency, is explaining why you didn’t!
Anonymous
OR“Worry a bit now, or worry a lot later!”
Jay N. Rosenblatt
Business Preparedness:Disaster
Disaster:In general, most disaster events are defined by the need for external assistance
Anonymous
Business Preparedness:Warnings
Ice Storm: 19989/11: 2001SARS: 2003N. Am. Power: 2003Tsunami: 2004T.O. Blackout: 2005London Terror: 2005Katrina: 2005
Avian Flu: 20??
Business Preparedness:Be a Leader!
The first Business Continuity Manager was Noah, he had good connections and prior warning...we may not……… (Margaret G. Smith)
Business Preparedness:Here’s the Problem!
© Simpson Wigle LLP
Business Preparedness:Risks
Power Outage:59.07%•Hardware Failure: 51.04%•Natural Disaster: 46.87%•Telecom Failure: 41.73%•Network Failure: 40.61%•Software Failure: 39.97%%
KPMG B.C.M. Benchmarking Report: 2005
Causes of Interruptions (2004) 2005 Interruptions Affecting Businesses
Business Preparedness:Costs
Millions of Dollars per Hour in Lost Revenue
6.5
3.62.8
2.6
21.6
1.61.5
1.3
1.21.1
Retail brokerage
Point of sale
Energy
Credit card sales authorization
Telecommunications
Call location
Manufacturing
Financial institutions
Information technology
Insurance
Retail
Source: META Group
Business Preparedness:Costs
In recent years, disasters have forced more than 4M Canadians from their homes – and caused $B’s in damage. Payments by governments & insurers have been doubling every 5-10 years.
Canadian Red Cross, 2000“For companies that do have plans, 19% haven’t tested
those plans in the past 5 years.”Whitehat & Fibrewired
“Following a disaster - 4 out of 10 U.S. businesses never reopen; of those that do, 25% close within 2 years.”
Gartner Research
Risk Management & Minimization:LEGAL DUE DILIGENCE is The Answer!
Risk Management & Minimization:LEGAL DUE DILIGENCE is The Answer!
Standards:NFPA 1600DRJ/DRII GAPISO/IEC 17799BS (BSI) 7799BASEL Committee on Banking Supervision
Business Preparedness:Legal Issues & Liabilities
BUSINESS CONTINUITY
Critical Business Functions
Contracts
OH&SAWS&IB
Negligence
C-45
Pandemics
Regulatory Compliance
EmploymentDisruptionDisaster
EmergencyPandemic
© Simpson Wigle LLP
Contracts
Issues:Professional Advice‘Precedents’Terms & ConditionsBoiler PlateForce MajeureOutsourcing & SLA’s
Negligence
What is it:
A failure to do what a reasonably carefuland reasonably prudent person would do in the given circumstances
The relation is such as to produce a risk of foreseeable harm, creating a duty of care, and the degree of care is not taken.
Jay N. Rosenblatt
Negligence:Is This Your CEO?
Should I Ignore it or Deal with it?
Tell your Board & Sr. Management that
Inaction Is a Decision!
Negligence:Inaction Is Not The Answer
Inaction is an act of Negligence!
Employment
Employees:Your biggest ResourceYour biggest Risk
Issues:Inadvertent Disruption (I.T., Security, etc.)Malicious Disruption (I.T., Security, etc.)N.D.A.Non-Comp.Termination
Regulatory Compliance
Examples:C-12: Emergency Management Act (Canada)Bill 56: Emergency Management Act (Ontario)SOX/Bill 198S.E.C./Cdn. Stock ExchangesPIPEDA (Canada)OH&SA/WS&IB (Ontario)C-45 (Canada)Others …
Regulatory Compliance
C-12: Emergency Management Act (Canada):boost Canada’s role in emergency preparednesscoordinate disaster response plans among federal departments
Bill 56: Emergency Management Act (Ontario):Provide emergency powers ~ Declared EmergencyPromote the public goodProtecting health, safety & welfarePrevent, reduce, mitigate harm/damageTravel restrictions, care facilities, goods, servicesOffences & Penalties
DEFENCES: no actions against municipalities & employees … good faith exercise of duty …
Pandemics
Pandemic Influenza Risk:Is a Pandemic Influenza Risk really different than any other Emergency Management/Business Continuity RiskLegal Issues/DriversBusiness Issues/Drivers
Pandemics
Introduction: ~35% of thepopulation
Spread: entrenched in all thecontinents within 3 months
Death: 50% rate to date; medium level in u.s.: 100-200k; 2m-7.4m in world;1918: 500k deaths in u.s. and 20-50m worldwide
New vaccines:No vaccine until exact strain isknown; 6-12 months for INITIALsupply;Tamiflu is no guarantee;New vaccines: 6-12 months CDC, Who,
Quarantines: quarantine and EIsolation is critical
Infections & hospitalizations:Sick: 30% (90M)Clinical Visits: 42MHospitalization: 315K-735KDeaths: 90K-210K
conomic Impact:$71B-$115B; (SARS: $40B) & nota pandemic
National Institute of Health
Pandemics
‘The pandemic clock is ticking – we just don’t know what time it is’
Canada:Sick: 4.5M-10.6MClinical Visits: 2.1M-5.0MHospitalization: 34K-138KDeaths: 11K-58K
U.S.A.:Sick: 90MClinical Visits: 42MHospitalization: 315K-735KDeaths: 90K-210K
Toronto:Sick: 392-914KClinical Visits: 161K-701KHospitalization: 1.6K-14KDeaths: 630-4.3K
Pandemics
Men’s HealthNovember, 2005
Pandemics:The Rule of 3
3 Times/century3 Issues:• Detection• Containment• Prevention
3 Feet for Social Distancing3 Days are not enough3 Waves within 3 (9) months3 Business Concerns:• People• Process• Products
Business Preparedness:Bookends
Convince you that with Pandemics (& ANYdisruption/disaster):
Directors & Sr. Managers are at tremendous personal riskYour Business & all its resources are also at tremendous riskYou SHOULD worryDUE DILIGENCE is a legal defenceThere ARE immediate actions that can be taken that will minimize risk to you & your BusinessThese actions MUST be takenWHAT DO WE DO NOW!
Business Preparedness:Risk & Opportunities
Leveraging the Opportunities:
The pandemic clock is ticking – we just don’t know what time it is…
At the heart of each crisis lies a tremendous opportunity.
Great Blessings lie ahead for the one who knows the secret of finding the opportunity within each crisis.
Business Preparedness:Legal Resource Analysis
BUSINESS CONTINUITY
DisruptionDisaster
EmergencyPandemic
Critical Business Critical Business FunctionsFunctions
Manpower:Human
Resources, Admin.
Materials:S.C.M.
Money:Patrons & Services
Time:Lost or Wasted
Information:Information Technology
Space:Locations
© Simpson Wigle LLP
Business Preparedness:Take Your Pick!
Information:Information Technology
Space:Locations
Money:Patrons & Services
Materials:S.C.M.
Manpower:Human Resources
Admin.
Time:Lost or Wasted
Business Preparedness:Up for the Challenge?
Write down actions that will have an immediate and positive impact on your Board, Sr. Management & your Business
Business Preparedness:Q & A
Jay N. RosenblattSimpson Wigle [email protected] #301