Managing Political Instability in Emerging Markets

Slowing economies, oppressive regimes, and broad societal changes have contributed to political instability in emerging markets and other countries in recent years. Companies with interests in such areas face the potential for political violence, terrorist attacks, resource nationalism, and expropriation actions that can jeopardize the safety and security of their people, assets, and supply chains.

Risks related to political instability cannot be completely eliminated, but multinational businesses can take steps to limit the potential effects on their operations.

Crisis Management and Business Continuity
Before instability develops, businesses should have well-tested business continuity and crisis management plans in place. Organizations should identify their essential functions and assess the potential impact of unrest in various countries, taking into consideration customers, employees, and other key stakeholders.

Companies can be affected by political risk even when their own operations are in less volatile regions. For example, supply chains can be impacted, making it critical for businesses to ensure that their suppliers and other partners have robust risk management plans, while simultaneously making alternative suppliers part of resiliency planning.

To help protect people, operations, and assets, businesses should consider taking proactive steps, including:

Maintaining up-to-date locations and travel plans for all employees and enabling them to report their status.
Providing employees with regular updates about local government travel advisories.
Communicating with staff in affected countries to gain advice or provide information about changes to their situation.
Monitoring airlines’ flight schedules and status.
In a crisis, communication is crucial but could be hampered by government interference, damage to communications networks, loss of power, or other factors. Businesses should maintain current and complete contact information for employees — including personal email addresses and mobile numbers — so that they can be reached through as many channels as possible. If appropriate, organizations should also consider the use of satellite phones or other technologies that may be more reliable during a crisis.

Businesses should maintain frequent contact with local embassies, consulates, and other government representatives, which may be able to assist their nationals with communications or evacuations in a crisis. Prior to an event, businesses should have employee citizenship information; employees should have passports, visas, and other travel documents on hand

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