Social risk management, key to avoiding operational crises

The strikes, protests or demonstrations that take place in front of a company have already become part of the national landscape, And regardless of whether they have licenses or permits, many tend to forget that they intervene in territories with the presence of ethnic communities, unionized workers’ associations and various groups that disagree with corporate procedures and the need to implement the projects in charge.

(Risks for companies of having workers without social security).

What few know is that these situations also affect the organization and negatively impact its finances, so it is not about finding the good or the bad, but about solving the problem and benefiting both parties. That is why risk management is positioned as a key factor to read the environment and prevent operational crises in 2023.

A close example of this situation could be seen recently in El Guavio, where protesters decided to block the main roads for several days, asking the government and the Enel energy company to fix them. The fact caused that two units of the hydroelectric plant were declared unavailable after not being able to carry out the maintenance required in the operation, which, at the time, the company director indicated would translate into higher energy costs for the entire population. .

(The top 10 risks facing the world in 2022).

Like this, multiple cases occur in Colombia and other Latin American regions, for which social risk management is positioned as a key tool. Even for the expert Guillermo Pattigno, co-founder and current general manager of ACD Consultores, a company that seeks to build together to the big companies prosperous and sustainable environments, these types of strategies are essential to reduce the negative consequences of unexpected events, actions or omissions.

“From our company we have a relationship and trust-building strategy that we call ‘Sustainable Dialogues’, and it is basically a tool with which we seek to develop preventive strategies within companies so that organizations have a better relationship with their environment, with communities, institutions and civil society through social dialogues”, Pattigno points out.

For this, a consultancy work must be carried out beforehand where, knowing the realities of the territory, strategies, mechanisms and instruments are established based on the identification of the main risks faced by the company, project or business area.

Then, the next step will be to carry out an analysis, assessment and prioritization of risks based on the probability of occurrence and level of impact. Finally, there is the planning of strategies and allocation of resources to prevent them.

The director of ACD Consultores explains that in this process companies must also make a prototype of possible crises. “The idea is to work on this with the teams in charge of this area, so that in this way, in the event that the events materialize, they can be dealt with immediately and the organization does not have to stop its operation for several days, generate economic losses and the communities or the workers are not affected either”.

It should be noted that this type of practice must be within the framework of Risk Management strategies, an area that has become more than necessary today for organizations, and that according to the Deloitte survey on Business Risk Management, would allow 76% of those responsible for this area, respond effectively if there is a major emergency tomorrow.

However, for this it is essential to have companies or consultants specialized in the matter, because in the same report it adds that only 49% of companies have manuals to solve contingencies and only 32% have ever carried out simulations, represented in operational issues , but the data is not the same in terms of social risks, which most do not consider.

(Factors that could put the sustainability of the economy at risk).

Failure to carry out this type of strategy effectively can affect different levels of the organization’s value chain and cause significant losses in sales, blockages and interruptions of the operation, security incidents, brand damage, claims, fines. , among other things.

“We must try to avoid the crisis from a preventive approach, however, if these events happen, the companies together with their management teams will have the capacity to manage the situation, making it easier to deal with”, highlighted the general manager of ACD Consultores.

It should be noted that in the future of these practices, technologies will also play a role in optimizing their processes, since they will facilitate the early identification of a possible crisis through the use of data and artificial intelligence, in addition to being able to determine the scenarios and solutions to serve you in the best way.