Magazine article Risk Management

Exporting Products, Importing Risk: Extortion Risk Awareness Increasing

Magazine article Risk Management

Exporting Products, Importing Risk: Extortion Risk Awareness Increasing

Article excerpt

One of the unfortunate side effects companies encounter as they begin to conduct business internationally is an increased exposure to extortion, product tampering and kidnapping incidents. As a result, a growing number of mid-size companies are starting to incorporate these exposures into their enterprise security and crisis management programs.

As company executives start to travel overseas, there is a greater chance of them becoming a target," says Kent Miller, senior vice president of middle markets at CIGNA Property & Casualty. "Just because an executive doesn't work for a large multinational company doesn't make him or her safe. Anytime you're in a country where you don't speak the language, you tend to stick out."

Andy Duffin, managing director of crisis management services for Pinkerton Consulting and Investigative Services, says that as companies evaluate potential joint venture partners and the financial elements of prospective deals, they also need to be aware of the potential security issues when they start to conduct business in a new environment.

"You don't want to have to react to a crisis after the event," Mr. Miller says. It's a mistake for a company to assume that a risk doesn't apply to it, because that risk is going to be much tougher to deal with later."

One of the ways Mr. Duffin says companies can improve the safety of travelling executives is by increasing their knowledge of the location they are visiting. "There are a number of steps that by themselves may sound very basic, but if they're taught as part of a coordinated program, they can be very effective."

For example, companies must make sure that drivers won't display a placard with a company's or an executive's name at an airport, which can alert kidnappers. Similarly, executives going to be met at the airport by someone they don't know should arrange a code word or symbol in advance. And varying daily schedules and travel routes will prevent potential kidnappers from identifying ambush points.

Mr. Duffin says an effective travel safety program identifying these and other potential incidents can be conducted within a half day, often as part of a corporate disaster management exercise.

Insurance can also play a role in a company's security strategy. …

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