The NFP sector is not immune from the impact of the corona-virus (COVID-19).
Developments arising from the spread of the virus constitute a ‘black swan event’, defined by Nassim Nicholas Taleb as an event that “is an outlier,” as it sits outside the realm of regular expectations. Black Swan events are therefore mostly unforeseen, rare, and caused by geopolitical, economic, or other unexpected developments.
No-one need wait for their annual environmental scan to recognise the corona-virus as the source of major disruption to ‘business as usual’. Doubtless every NFP organisation has escalated COVID-19 to high priority (high likelihood and severe consequence) status in their risk matrix. Consequently, they have been reassessing whether to ask staff to work from home, whether they can still run their conference, and whether their revenue model will be seriously damaged, alongside other concerns.
Various of my clients have raised diverse issues for discussion with me, such as:
- how to adjust strategic and operational plans (including performance management plans) when major goals and targets can no longer be reasonably delivered, and significant energy is now being invested in new priority activities not previously recognised in such plans
- responding to a surge in demand for welfare services as economic effects are felt more widely, which in turn leads to higher staff and volunteer burnout as they wrestle with limited capacity issues
- health practices which are required to use personal protective equiment (PPE) may have to close if they can no longer obtain these supplies – potentially putting services and businesses at risk of permanent closure
- how to respond to staff who expect hand sanitiser supplies and surface wipes to be available on every desk, and fresh masks to be issued daily
- how to offer guidance on business etiquette when hand shaking and other usual ‘courtesies’ are no longer acceptable
- how to check their insurance covers, service agreements and other contracts for suitable damage control mechanisms or risk transfer
- what approaches may need to be made to suppliers, contractors and strategic partners regarding changes in capacity and expectations (at both ends of the relationship)
- how to communicate with members and/or clients about steps being taken without sounding panicky or promoting undue worry
- how to treat staff equitably when some are being encouraged to work from home, while others need to attend the workplace because of the nature of their work
The precautionary principle must inform both governance and management responses to the virus threat. In Hippocrates words we must ‘first do no harm’. Protecting the health and welfare of the people we work with and for is our top priority, and all else follows from that. Beyond the moral obligation, there are also OHS and other regulatory compliance requirements of course.
Rather than offering specific solutions for each type of problem listed above, I thought readers of this blog might find it more helpful if I reiterated best practice risk management processes, which can be adapted for use in your particular circumstances. The risk and crisis management schematic in the header image above outlines one approach to the task.
From a governance perspective, your board and its risk committee should by now have met and reviewed your risk register to ensure that it includes an updated analysis and assessment of the risks posed to your organisation and its stakeholders. Some major areas in which consideration may need to be given are illustrated in the chart below:
Depending on the functions your organisation delivers, you may have additional or alternative risk categories to consider.
When updating your risk inventory you will want to use risk assessment, prevention, mitigation and response measures as per the ISO 31000 risk management framework, summarised in the chart below.
Having updated the risk inventory, your board will need to review the organisation’s strategic plan and consider any budgetary adjustments arising from anticipated revenue shortfalls or new expenses. Any implications for legal compliance, contractual obligations, or policy changes should also be considered.
Management may need to advise the board on staffing implications and other adjustments to operational programs if resources are no longer going to be available as originally expected. Communications with stakeholders will also require attention, so that their expectations are realigned in accord with the new reality as assessed by the board and management.
As more information becomes available and the COVID-19 risk rating changes, further refinement of your risk management plan may be required, so close monitoring of the situation is recommended. To assist in that exercise, regular checking of some of the following websites is suggested.
Safe Work Australia issued a reminder to all businesses that they must have protective measures in place to protect workers (along with volunteers and the public of course) at risk from the coronavirus (sometimes called COVID-19 and sometimes 2019-nCoV).
The Commonwealth Health Department has issued a COVID-19 Health Alert, which is updated frequently, including a collection of helpful resources for the general public, health professionals and industry.
The Victorian Department of Health and Human Services advice on COVID-19 is offered here.
Factsheets and posters about COVID-19 are offered by the US Centers for Disease Control and Prevention.
The World Health Organisation also offers a range of news, resources and guidance here.