Strategies for Business Resilience

In the previous article in this series, we learned that protecting your company can’t be achieved by insulating your operations from its interdependencies with society. Instead, business resilience requires embracing these dependencies. This is a big shift in leadership perspective and is best done in a stepwise manner, as Zurich Insurance Group’s Corporate Responsibility Manager Karin Reiter explained.

As an insurer, Zurich benefits by fostering business resilience and has begun developing approaches to help customers enhance the resilience of the communities in which they operate. “Our goal,” explains Reiter, “is to build a sort of blueprint for resilient communities, specifically flood-prone communities.” These blueprints can serve as globally accessible toolboxes from which companies can draw to build their own resilience plans and identify which interventions work best for their community. Zurich is doing so in countries where it operates, but is also sharing its expertise in the countries that are most exposed to risks such as flooding.

But isn’t asking an executive to think about the welfare of an entire community a big step? Maybe, but as Reiter points out, “a prosperous business depends on a prosperous community. You need people that are able to buy your goods and procure your services. You need to have access to skilled local talent. So you want to make sure that the communities continue on their development path.”

An effective strategy starts with making sure you protect your own factories by evaluating potential risks and actions that can be taken inside the gates of the company. This is important because many operators don’t know the risks that they’re exposed to. Zurich helps customers bridge this gap through its work with research organizations to better understand the risks they may be exposed to, such as flooding. But risk doesn’t stop at the fence line, so Zurich also encourages evaluating community resilience to understand why certain communities do a better job at protecting themselves against risk than others. This inevitably highlights interdependencies among businesses and communities.

“What we really realize,” says Reiter, “is that we can’t do it alone. Community resilience challenges are so big that you need players from different sectors to address these issues holistically.” That means reaching out to stakeholders and building mutually beneficial partnerships. As Reiter explains, “Zurich has a lot of risk management knowledge, but we may not have the access to the communities or local network. Likewise, potential NGO partners may understand the local level very well, but they may not have the disaster risk-mitigation knowledge that we bring. So we try to find those organizations that really have the complementary skill set that can work together.” That also includes policymakers and local governments, which are vital in establishing the right incentives and an early-warning system that can reach at-risk populations.

The end vision is to enhance the resilience of communities so that they can continue on their path of development. Doing so requires protecting and sustaining the community’s assets to ensure its ongoing health and prosperity. In this process, business is both a partner and beneficiary. Participating doesn’t mean business takes on sole responsibility for community resilience. Instead, you become a real citizen of the communities you touch. You do your part. You engage and encourage good policy. You get to know local NGOs and support their efforts.

Karin sums it up like this: “I do think it is in the best interest of companies to think beyond just their own footprint, because we’re all interdependent. We are relying on others. We’re not self-sufficient.” Business resilience and community resilience are interdependent, as the experience of the flooded Indonesian factory shows.