Already a Bloomberg.com user?
Sign in with the same account.
General Electric Co
Parker Hannifin Corp
Companies are reinforcing security at their facilities in the world’s trouble spots and reviewing evacuation plans after at least 23 workers were killed in an attack on a natural gas plant in Algeria.
The incident is prompting businesses operating in North Africa and other politically volatile regions to enact safety programs to protect employees, said Tim Husted of Carlson Wagonlit Travel. Companies are “very aware” of the militant attacks and are carrying out contingency plans, which may include relocation of non-essential personnel, he said in a telephone interview.
“In a situation where something like this happens in an area where these risks are very known risks, our clients tend to be very prepared,” Husted said.
AngloGold Ashanti Ltd. (ANG), the Johannesburg-based gold prospector with interests in three mines in Mali, said it’s reinforcing security even though its operations are far from the conflict. The company is limiting travel, avoiding certain routes and deploying additional guards around the mines and residential villages, said Alan Fine, a spokesman for the mining company.
Companies and many of the consultants that work for them generally won’t discuss their security measures, preferring not to share that information publicly. After the attacks in Algeria, corporate statements reflected caution and concern.
“We’re looking at all appropriate measures according to the situation,” Sebastien Duchamp, a spokesman for Fairfield, Connecticut-based General Electric Co. (GE) said in a telephone interview. “Our number-one priority is ensuring the safety of our employees at all times. We can’t discuss specific security protocols.”
Algeria’s special forces ended the takeover of the gas plant operated by London-based BP Plc (BP/), Statoil ASA (STL) of Norway and Algeria’s Sonatrach in a final raid on the facility Jan. 19. Security forces freed 685 Algerian workers and about 107 foreign captives, according to Algeria’s Ministry of Interior. Officials warned the death toll could rise.
While threats to corporate facilities and employees are not a new problem, improved technology and weaponry creates constantly shifting challenges that must be managed.
“There are new dangers, emerging dangers, and in many cases, the companies and organizations just are ill-equipped to handle that increased threat,” said Bruce Branson, associate director of the Enterprise Risk Management Initiative at the Poole College of Management at North Carolina State University in a telephone interview.
Algerian security forces weren’t prepared for the scale and severity of the attack on the gas plant, said Rob Harford, a director at Salamanca Risk Management, part of the London-based Salamanca Group Merchant Bank and operational risk consultant.
“When faced with a specific and direct threat, security levels and protection measures need to be enhanced,” he said.
Global corporations are increasingly relying on their own intelligence networks to anticipate and respond to events that threaten workers’ safety or damage their business, said Fred Burton, vice president of intelligence at Stratfor, an Austin, Texas-based corporate security consultant. Companies from energy and mining to transportation and hotels are hiring former military and government analysts, and investing in the most sophisticated surveillance and safety technology to improve their ability to avoid danger.
“They have to operate in these areas with a very robust capability to develop information on their own,” Burton said. “What they’re looking for are tripwires for events to start unfolding that may give them even three hours, if not 72 hours, to be able to batten down the hatches or start removing their personnel from some of these volatile areas.”
Terrorist attacks are only one part of the array of threats companies face. Corporate security forces must develop intelligence networks in regions with increased potential for violence, shoring up detection and defense capabilities.
Piracy off the coast of Somalia has declined thanks to the shipping industry’s increased use of armed guards and international naval patrols. Violent pirate attacks are rising, though, off the West Africa coast, where dozens of tankers transit every day.
Oil and natural gas companies including The Hague-based Royal Dutch Shell Plc, San Ramon, California-based Chevron Corp. (CVX) and Total SA of France have battled Nigerian thieves and militants for decades who attack their facilities and sabotage pipelines.
MTN Group Ltd. (MTN), Africa’s largest mobile-phone operator, said such attacks are hampering its abilities to provide service in Nigeria. The Johannesburg-based company has suffered damage to its fiber-optic network with more than 70 cuts to lines a month nationwide, it said last year. Bomb and gun attacks blamed on Islamist militants have hindered repairs and slowed new construction.
“As you fix it, it goes down again,” said MTN Nigeria Communications Chief Executive Officer Brett Goschen in a May 15 interview in Lagos.
Foreign workers have long been a target of kidnappings and attacks by paramilitary groups and criminal gangs in Latin America, especially in Colombia. Colombia’s armed forces are searching for rebels that kidnapped five people working for Toronto-based gold prospector Braeval Mining Corp. (BVL) last week, including three employees and two consultants.
“The company is fully cooperating with efforts of the authorities to ensure the safety and health of its employees and consultants,” Braeval said in a statement Jan. 18. The kidnapping was carried out by 25 members of the National Liberation Army, according to Armed Forces Chief Alejandro Navas.
Anticipation and prevention is a growing focus of companies operating in regions where foreigners can generate resentment and hostilities, especially energy and mining workers who tap natural resources, said Daniel Karson, a chairman with Kroll Advisory Solutions in New York.
Kroll advises companies to throw out preconceptions and start from scratch in evaluating safety at their facilities. Priorities are “lives first and assets second,” Karson said.
Companies start by assessing potential threats in their chosen location, including political risks and any history of violence in the area. Security officials are diving deeper into the backgrounds of the people they hire or work with, searching for red flags such as a history of accepting bribes, Karson said.
Remote facilities like the gas plant in Algeria, where help is not close at hand, get special attention. Buildings are reinforced and technology is used to control access to the perimeter and interior of the facility, including alarm systems, panic buttons, and retinal or fingerprint-scanning systems to secure doors. Cameras can stream live images of the premises to security monitors anywhere in the world, Karson said.
“There are any number of 21st century technological approaches you can use to protect the facility,” he said.
Avoiding dangerous places is one of the basic security measures taken at Parker Hannifin Corp. (PH), a motion and control equipment-maker based in Cleveland, Ohio, said Chief Executive Officer Don Washkewicz. Washkewicz canceled a trip to the Middle East after the attack on the U.S. consulate in Benghazi in September that left the U.S. ambassador to Libya and three other embassy staff dead. And he won’t travel to Colombia.
The company, with 311 manufacturing locations in 48 countries, provides security guards for executives traveling to places like Brazil and Mexico.
“You never can be 100 percent safe, but we try to be as safe as possible,” Washkewicz said.
Companies are working harder at preventing violence with more awareness of the issues that can trigger social unrest and make a company a target, said Iain Donald, a senior vice president who works in risk analysis at Control Risks Group in New York. Executives need to manage projects with as much sensitivity as possible to local concerns about the environment, jobs and politics.
Many community grievances can be managed, and “in the perfect world that happens from the outset,” Donald said.
Donald joined other security experts in pointing out that some things are beyond a company’s control, such as organized crime in Mexico or Colombia, or the political grievances of rebel groups.
“It’s very difficult to make things safe,” said Simon Hawkins, an oil analyst at Nplus1 Singer Ltd. in London who was captured by gunmen when he worked for Shell in Nigeria in the 1990s. “Armored guards, security gates, locked fire doors -- that’s all you can do, really, and sometimes that’s not good enough.”
To contact the reporters on this story: Edward Klump in Houston at email@example.com; David Wethe in Houston at firstname.lastname@example.org; Brooke Sutherland in New York at email@example.com
To contact the editor responsible for this story: Susan Warren at firstname.lastname@example.org