Personal Bias and its Effect on Disaster Preparedness

Sometimes it is hard for company risk managers to prepare adequately for a risk when the risk itself is controversial. Such is the case with disasters brought about by climate change, including flooding, drought, mudslides, wildfires, and everything in between.

Part of the problem is the low priority given by company executives to climate change and the disasters that result from such global change. Many executives and company risk managers for such businesses as utilities, or other companies in areas vital to our infrastructure, feel that in the end taxpayers or their customers would make the companies whole again when faced with a climate event, according to Some ask why they should have a comprehensive plan when preparations could disqualify them from receiving future assistance that the competition, which might not have prepared for the crisis, would receive.

Furthermore, if climate change were to cause something truly disastrous that was difficult to recover from, then some risk managers think that the company would more than likely not have been prepared adequately anyway. Some also believe that since everyone would be hard hit in a major disaster, including the competition, everyone would be in the same boat when it comes to recovery.

So the question remains: Does it makes sense to manage such risks as those associated with climate change in view of the tradeoffs or constraints that such management entails. Of primary concern is cost, as company risk managers try to balance the needs of the company with what could “realistically” take place and effect the bottom line of the company. The real question is: What is the cost to not be prepared for an extreme disaster?

Recent super storms and other events have shed light on the answer to these questions. These recent disasters remind us that both the lives of citizens and the continued operation of the business and utility sectors are at stake. Climate change disaster should be a concern for each company risk management officer.

For more information about why risk managers should prepare for all disasters, visit: