Thai floods a turning point for private sector

SENDAI, 16 March 2015 – A UNISDR private sector champion today called for the high standards that are typically applied to major infrastructure projects to be the benchmark for the majority of urban areas that are residential and home to small businesses.

Mr. Aris Papadopoulos, retired CEO for Titan America and the first Chair of UNISDR’s Private Sector Advisory Group, said the areas where the biggest proportion of people live and where the majority of smaller enterprises are located are generally the most exposed and vulnerable locations.

“The ‘built environment’ is where we spend 95 per cent of our lives,” Mr Papadopoulos said. “And it is in residential areas and commercial districts for SMEs (small-medium sized enterprises) where 80 per cent of destruction from disasters occur.

“Unfortunately, building codes present the lowest common denominator and they are often not enforced as well as they are when it comes to larger infrastructure. But let’s look at what the automobile industry did in the 1960s: they embarked on a great change towards safety for cars. Why do we not have the same radical change in our approach to the built environment?”

Mr. Papadopoulos was speaking at the ‘Business and Private Sector: Investing in Resilient Infrastructure’ session at the Third UN World Conference on Disaster Risk Reduction.

He pointed to ‘Five Visions for a Resilient Future’ unveiled at the World Conference by the UNISDR Private Sector Partnership (PSP), which he said was a roadmap to “move from disaster reaction to resilience pro-action”.

The vision comprises the following five elements: strong public private partnerships; resilience in the built environment; risk-sensitive investments and accounting; positive cycle of reinforcement for a resilient society; and private sector risk disclosure.

Deputy Secretary-General of Thailand’s National Economic and Social Development Board, Ms. Ladawan Kumpa, recalled the US$47.5 billion direct economic cost of the country’s floods of 2011. The disaster, in many ways, highlighted why such a private sector vision for the future is needed.

“During the floods, the business’ logistics systems did not work, material could not be delivered, products could not be distributed, employees could not get to work,” Ms Kumpa said.

“We recognized the problem as a lack of knowledge, expertise and experience to do business continuity planning as well as a lack of common standards and practical principles.”

However, she said the 2011 disaster had acted as a turning point for attitudes and action in terms of business continuity management and that business and the local economy was becoming more resilient and attractive to business investment.

The Chairman of the Japan Automobile Manufacturers Association, Mr. Toshiyuki Shiga, said that Thailand’s response to risk management after the floods had meant that the country remained a very important location for production and operations for Japanese business.

PWC’s Coordinator of the R!SE Initiative, Mr. Scott Williams, took up the theme of growing international cooperation and explained how RISE “represents a new way of collaborating to unlock the potential for public and private sector actors who are ready and willing to make a step forward and take leadership on disaster risk reduction”.

“The overall goal of the initiative is to make all investments risk-¬sensitive. R!SE will facilitate the exchange of experience and knowledge to implement tangible disaster risk reduction projects through eight streams of activities: strategies for global business, risk metrics for economic forecasting, industry sector certification, education, principles for responsible investing, resilience of cities, insurance, and resilience of UN programming,” Mr. Williams said.

The Managing Director of Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH, noted Germany’s commitment to sharing knowledge on disaster resilience and said as a result the country had launched a Global Initiative for Disaster Risk Reduction, which includes contributions and lessons from the private sector.

The session moderator, Mr. Hiro Nishiguchi, President of the Japan Bosai Platform, and Executive Managing Director Japan Innovation Network Speakers, in closing said the private sector had so much to offer in terms of disaster resilience because of its innovation, commitment to solutions and prioritization of business continuity.