Business continuity planning in the wake of Hurricanes Katrina and Rita

According to a survey conducted at this week's annual conference of the Association for Financial Professionals (AFP) and sponsored by JPMorgan Chase, the majority (55 percent) of respondents said that their organisations are only ‘somewhat prepared’ with business continuity plans to handle an event similar to Hurricanes Katrina and Rita. Only just over a third (37 percent) of US-based treasury and finance professionals feel that their organisation is ‘well prepared’ and 8 percent believe their organisation is not prepared at all.

"Our survey demonstrates that there is a level of uncertainty among treasury and finance professionals that their business' continuity plans are in a state of readiness that will enable them to continue operating in the case of an event similar to the two hurricanes," said Jim Kaitz, president and CEO of the Association for Financial Professionals. "With responsibilities that include managing trillions of dollars through the global financial markets each day, AFP members play an essential role in the US economy, and in the days following the hurricanes they struggled to deal with a range of issues. AFP is committed to helping our members acquire the knowledge to enhance their business continuity plans."

47 percent of finance professionals said that their organisation's operations were impacted by Hurricanes Katrina and Rita – 12 percent significantly impacted - while 53 percent of survey respondents reported that their organisation suffered little or no impact.

Despite the fact that almost half of the respondents said their organisations' operations were impacted, only 24 percent of respondents said their business or organisation has recently tested its business continuity plans as a direct result of the hurricanes. Further, only 26 percent plan to test their business continuity plans in the near future while 50 percent have no such plans.

According to survey respondents, the primary areas addressed by most companies' business continuity plans include:

* Back Office Operation Redundancy : 72%
* Offline Business Operations : 65%
* Corporate Communications : 58%
* Liquidity : 49%
* Account Payable/Receivable : 49%
* Employee Payroll/Emergency Funds : 49%

Despite the fact that staff and site protection and staff and recovery worker accommodations are significant issues along the Gulf Coast, these issues are not as frequently addressed in organisations' business continuity plans according to the survey respondents.

More than 1,000 finance professionals participated in the survey

•Date: 13th Oct 2005 • Region: US • Type: Article •Topic: BC statistics
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