Crisis Management Malta April 8, 2008 Andy Jarosz, BSc MBA Director, Head of Crisis Management

“Any situation which has the potential to affect long term confidence in an organisation, its services or which can interfere with its ability to continue operating normally” Definition of crisis :

Everybody loves a crisis ….

Why prepare?

The Impact on Shareholder Value Cumulative Abnormal Returns (%) i.e., change in market cap adjusted for market movement Source: “The Impact of Catastrophes on Shareholder Value,” Rory F. Knight & Deborah J. Pretty, Templeton College, University of Oxford, p. 3. Trading Days After the Event Effective Crisis Response Ineffective Crisis Responses After initial reflex (10 days), market begins to assess company’s response.

7 steps for crisis readiness:

“It will never happen to us”

Corporate Manslaughter Previously  Focus on individuals  Need to show blame at single point  Could lead to imprisonment  Drivers, doctors most at risk  Avoid blame: diffuse management systems Now  Focus on company  Assess duty of care within organisation  Offence if “far below” what is reasonable  Proven senior management failure  Unlimited fine  Possible “publicity order”

Duty of Care Client Agency Supplier (DMC) 2 nd / 3 rd Tier Supplier

Times they are a-changin’  Known knowns - process  Known unknowns - audit  Unknown unknowns - crisis planning How are agencies reacting to this?

Armed = Prepared Buyers’ Pack  Liability certificates  Fire / hygiene certificates  Internal safety audits Crisis Plan  Minimum basic plan template  Know who will do what  24 hour contact number for agency  Annual exercise and review

Peace of mind  Agencies want reduced exposure  Reassurance will sell  ROI on safety will increase  Window of opportunity – two to three years  Promote a common national system

Thank you! Tel: +44 (0)