CHALLENGES

EVALUATING RISK

Climate change is increasingly seen as an existential threat and a significant risk to business operations. Corporations are now looking at the short- versus long-term risk and where travel management fits in. Some businesses still manage each extreme weather disruption through standard business continuity practices instead of considering the implications of long-term, escalating risk¹⁰.

ISO standards such as ISO 31030, which accounts for ‘travel risk management’ can help. It requires organisations to anticipate and assess the potential impact of events, develop mitigations and communicate anticipated risk exposures to their employees. It’s also the role of travel management companies to help businesses equip themselves with information about evolving risks.

Many businesses are still unaware of ISO 31030 as a methodology to help manage duty of care responsibilities and improve travel policy. It is fair to say that the need to access verifiable travel risk intelligence escalated with the emergence of the global pandemic. Risk assessments, and the due diligence performed prior to corporate trips, are now being calculated more frequently and vigorously.

When a business faces significant travel disruptions due to extreme weather events, or suffers the financial impact due to something going wrong with their travel programme, this leads to a series of events where businesses move quickly towards the adoption of a travel risk management solution. The aim is to ensure it doesn’t happen again and the company has less exposure to this risk¹¹.

The future resilience of business travel will depend on the sector’s ability to embrace a low carbon future and cut emissions.

Chris Truss, Reed & Mackay International Development & Sustainability Director

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REGULATION

Changing regulations represent a significant issue for businesses looking to account for emissions. Legislation is changing the goalposts for how corporations deal with climate change as a business risk and how this impacts business continuity and managed travel.

For instance, there is now a European Commission initiative to propose a harmonised framework for calculating and reporting greenhouse gas emissions from the transport sector, called CountEmissionsEU¹². This will ensure the right data is put in place with a common calculation methodology.

The aim is to pave the way for the effective decarbonisation of the business travel sector, which is currently hindered by fragmented methodologies. A number of organisations have highlighted a lack of standards when it comes to carbon emissions; this is a major challenge¹³.

EVOLVING TRAVEL POLICIES

While six out of 10 companies have a sustainability policy, only three out of 10 have a policy that includes business travel, according to research by the GBTA¹⁴. As climatic threats increase, affecting business continuity, there are likely to be additional policies put in place that go beyond the traditional crisis management.

Travel policies could also evolve to mitigate the climate risk from business travel, such as longer trips involving multiple destinations rather than many short-haul trips. Tying travel into global mobility solutions and keeping executives overseas for longer or dispersed – so they’re more able to keep the business running from multiple offices and sites where one or two may be affected by climate change – could become a strategic imperative.

If travel to various territories at various times of the year becomes impacted by climate change, I can see businesses are going to have to rethink travel policies to reflect that.

Andrew Milne, Reed & Mackay Risk, Quality and Compliance Manager