Corporate Travel Safety
Keeping employees safe on the road can be a challenge for large companies.
Do you know where your employees are? That question is asked more and more often in corporate C-suites in a troubled world that presents new perils every year for international business travelers.
In fact, it has contributed to the growth of a new industry: firms that specialize in helping corporations warn, track and protect their travelers from all sorts of risks. This specialty in travel risk management has mushroomed in the past decade: “9/11 was the wake-up call,” notes Tim Daniel, executive vice president of International SOS, one of the leading vendors.
The global economy means more road warriors are venturing outside traditional comfort zones. A 2011 survey of 4,700 international business travelers by International SOS found that 60 percent travel to high-risk destinations at least once a year, while 16 percent do so five times a year or more.
Corporations that do send employees and expat staffers to potentially risky places have a duty to keep them safe, whether the potential danger is natural disaster (e.g., Japan’s tsunami; New Zealand’s earthquake), man-made crises (Mumbai or London terrorist attacks; Arab Spring civil uprisings) or something as simple as getting the right pre-trip inoculations or making sure employees obtain medical care after a rental car accident.
It’s Your Duty
It’s called duty of care, and it’s a legal responsibility as well as a moral one. Dr. Lisbeth Claus, a human resources professor at Willamette University and a specialist in this field, defines it as “the obligation employers have for the health, safety and security of their employees when they travel across borders.”
What are the consequences of ignoring duty of care? Besides the initial cost of responding to an employee emergency—which could be tens of thousands of dollars for an evacuation flight, for instance—there’s potential liability for an employee’s long-term care, worker’s compensation and more.
“There is a strong body of case law, and some legislative law, that dictates an employer has a responsibility,” Daniel notes. “One lawsuit (lost by the company) could pay for many years of these programs.”
Claus says that of 39 cases she reviewed in which an employer was sued by an employee (or his survivors) over failure to provide duty of care, the employers lost 34.
Her research indicates that although most executives know their company has this responsibility, “most organizations are still failing to implement a duty of care strategy,” says Claus, who recently conducted a global benchmarking study of more than 600 companies. A 2011 poll of companies by StarCite found 63 percent did not have a duty of care program in place.
The least your company can do is maintain a good travel insurance policy. But that’s just the reactive piece of risk management. The proactive elements include trying to keep the employee from a dangerous situation in the first place; or if he must go, taking steps to protect him from danger at the destination.
Who’s in Charge?
Creating a program is a multidepartmental task. Claus says company stakeholders with primary responsibility for implementing duty of care are the HR, security, senior management, travel and risk management departments. The “biggest obstacle,” she says, “is that no one is in charge, and everyone is. There has to be a coordination responsibility.”
In a 2010 white paper on risk management, the Global Business Travel Association (GBTA) notes that a strong program will include pre-trip risk assessments, and that requires a source for up-to-date intelligence about conditions at the destination. The company also needs to know exactly where its travelers are—not just where their itinerary said they were going. And that knowledge isn’t much use unless there’s also a way to communicate with travelers to update them on crisis situations, and a way for them to contact help if they need it.
A corporation’s travel management company (TMC) must be included in building a program and working with a vendor, since the process relies on itinerary data initially captured by the TMC. According to Julie Bottner, executive vice president and general manager of American Express Global Business Travel, TMCs “play an essential role in helping companies understand where their travelers are and facilitating ways to bring them back home and out of impacted areas.”
She suggests that the TMC can serve as liaison between “all points in the travel supply chain,” including travelers, travel managers, corporate security and risk officials, and suppliers. If a company works with more than one TMC, a good risk management vendor should be able to collate traveler data from all of them. Major TMCs often have partnerships with risk management companies and market the latter’s services to their corporate customers.
To calculate return on investment for such a program, an organization will need to carefully analyze its expatriate and business traveler population, GBTA’s literature notes: How many employees travel abroad, and where do they go? The level of risk varies by country, by job duties and even by the “different risk behaviors” of individual employees.
The Employee’s Role
That brings up another issue: If companies have a duty of care, travelers have what Claus calls a “duty of loyalty”—a responsibility to follow their company’s travel policies (e.g., if they don’t book a trip through the company’s TMC, their itinerary data can’t be captured) and to avoid risky behavior unrelated to the business purpose of their trip (e.g., taking a free day at the destination to go rock climbing or white-water rafting).
Claus suggests a company should create “a duty of care/duty of loyalty culture” through internal education. In addition, “we need to institute much greater accounting controls in terms of whether the [company’s] policies and procedures are being followed, and link that to whether we’re going to pay for the travel or not,” she says. Besides assigning responsibilities, Bottner says, a company’s program should also define—in advance—“what kinds of actions are needed for different trip disruption levels—whether it be from a weather-related disaster, political unrest or even an inconvenient canceled flight.”
Technology is making the process easier these days, since so many travelers carry smartphones. Risk management vendors have systems in place that routinely conduct risk assessments of their clients’ travel itineraries and can “push” warnings to the traveler about any threats at the destination.
Eyes in the Sky
Vendors can even use the traveler’s phone to determine exactly where he is—and that’s a potential problem: Would you want some remote computer system tracking your every move? Vendors like iJet Intelligence Risk Systems and International SOS are starting to use location-based technology, and expect to handle the issue by letting the traveler decide.
“The first way we deal with the privacy issue is a company has to say they want to participate or not participate. And if the company says yes, then the traveler has to opt in, to say, ‘Yes, I want my phone to be location-aware,’” says Daniel. “And then the traveler has the ability to disable that or opt out at any time.” But he adds: “The company has an ability to respond much more effectively [to an emergency] if the traveler opts in.”
Daniel says that even for opt ins, location tracking doesn’t have to be constant. “If you can track someone to have arrived in a city and then check again every 12 or 24 hours that they are still in the same city, that is a reasonable level of tracking.”
At What Cost?
Can your company afford a comprehensive traveler tracking and risk management program—especially if it’s a smaller company? The Global Business Travel Association notes that vendors offer three basic pricing models.
The traditional model includes an annual licensing fee, an implementation fee and a per-trip fee for traveler tracking. Menu-driven pricing is based on the type of different services contracted for (such as medical assistance), with a per-trip fee for tracking. And a fixed-price program charges an annual fee based on overall travel volume, plus an initial licensing charge and a one-time fee for data-feed implementation. If the number of trips exceeds the agreed-upon volume, a per-trip fee kicks in.
In ballpark terms, Bruce McIndoe, president of iJet, says firms with low travel volume are “probably looking at $10 to $20 per trip to have both a proactive and a response capability. [When] the programs are larger, costs can go way down to just a few dollars per trip.”
The example from International SOS’s Tim Daniel is for a company that spends $30,000 to send 10 employees on overseas business trips. The cost of risk management “is going to be 1 or 2 percent of that,” he says. “When you plug the costs of these programs up against the cost of actual travel, it’s minuscule.”
And there’s the potential cost of not having a program. “The business case for implementing duty of care standards falls in line with the basic tenet of risk management theory: The cost of prevention is cheaper than the cost of dealing with incidents,” according to GBTA literature.
In a 2011 global benchmarking study of 628 companies she conducted for International SOS, Lisbeth Claus asked respondents to name what they consider to be the most dangerous countries to which they send employees . The results:
|1. Mexico||11. South Africa|
|2. Nigeria||12. Angola|
|3. Afghanistan||13. Philippines|
|4. India||14. Russia|
|5. Pakistan||15. Iran|
|6. Iraq||16. Brazil|
|7. Papua New Guinea||17. Vietnam|
|8. China||18. Algeria|
|9. Democratic Republic of the Congo||19. Colombia|
|10. Indonesia||20. Saudi Arabia|
Jim Glab is an Executive Travel contributing editor based in Colorado.