Technical Session 3

Private Sector Role in Disaster Risk Reduction: Public-Private Partnerships

ISDR Asia Partnership22 April 2014

KEY QUESTIONSHow to incentivize the private sector to make

risk-sensitive investments?

1. What are the drivers?– To build their own resilience– To contribute to the society’s resilience

2. What are the requirements?

3. Who should be responsible for reducing risks resulting from private sector activities?

ENGAGING THE PRIVATE SECTOR IN DISASTER RISK MANAGEMENT

Background Paper to Technical Session 3

BACKGROUND1. Economic Impacts of disasters on businesses2. Role of the private sector in DRM3. Change of paradigm in DRM: towards – more risk-sensitive investments, – conditional aid and – strategic partnerships

HFA & THE PRIVATE SECTOR1. Reflections on HFA1: Remaining challenges– Legal – regulatory– Lack protection of GVC– Lack differential treatment to SMEs

2. Transition to HFA2: A transformative agenda– Integration of DRM in business management– Strengthen public policies – Broadening partnership

RECOMMENDATIONS FOR ACTION1. Recognition: forming task forces, publish reference

guide

2. Promotion of the enabling environment: publish resource books, integration of risk information in investment promotional packages

3. Promoting multi-sectoral collaboration and partnerships: establish dialogue platforms at regional, national and local levels

SESSION STRUCTURE

Technical Session 3

SPEAKERS LINEUP• Chair: Ministry of Industry, Thailand• Keynote: Global Champion on PPP• Presentation of background paper: ESCAP• Panelists: – Kokusai Kogyo, Chair of the ISDR - PSAG– Australian Business Association– Loxley, ESCAP Business Advisory Council – Major industry

KEY MESSAGES

Proposed phrases

“Disaster risk management is good for business”

“Responsible and resilient business is profitable business”

“Business resilience is the concern of the private sector as much as it is of the government”

“Government plays key role in providing the enabling environment for private sector’s risk-informed investments”

BACK UP SLIDES(previous presentation from 16

September 2013)

http://apbf.unescap.org/

Where — This year, APBF 2013 is scheduled to be held in Bangkok, Thailand at the United Nations Conference Center.

When — 25 - 26 November 2013 (please note that the Sixth Meeting of the ESCAP Business Advisory Council Meeting is a closed session by invitation only).

Who — APBF participants consist of business, government, academic, civil society and other key stakeholder from across the Asia-Pacific

Simple Overview: DRR in the Private Sector

• Hazards• Vulnerability• Capacity Gaps

RISKSRISK MANAGEMENT andMITIGATION • Reduction/Adaptation• Consequence Management

RESILIENCE BUSINESS STRATEGIES

&RISK GOVERNANCE

Good Practices Concepts

Damage & Losses

Preparation& Response

Policy Recommendation

s

• Drivers• Partnership• Accountability

ENVIRONMENT

ECONOMY SOCIAL

Regulatory & IncentiveFrameworks

Event/Crisis

Risk-informedinvestments

Consultative Outline• Regional Study: Provide academic backing for policy

recommendations – Aligned with private sector needs and special interests

• What Core Topics Of Coverage?– Situation Analysis: Private Sector and Overlapping Risks – Disaster Risks For Business– Business Strategies and Risk Governance– Best Practices and Methodologies of Incentive Frameworks– Policy Recommendations (based on 4 areas of coverage listed above)

• How: ADPC & ESCAP with private sector’s active leadership and contributions

Methodology

• Literature Review

• First-hand Data Gathering– Surveys– Expert Interviews

• Economic Analysis and Modeling

• Case Studies– Partnership, risk-

informed investments, sectoral practices, etc.

Possible Content:1. Disaster Risks For Business

– Disaster risk theory• Dimensions of disaster risks

– Impacts and probabilities of disasters; economic, environmental and geographical characteristics/factors

• Exposure, risk reduction, resilience

– Global value chains (GVCs)• Increasing importance in Asia & the Pacific, risk matrix

– Business strategies and operational practices• Crisis planning and management, risk hedging, diversified sourcing, operations and

logistics, advanced ICT applications, standards, norms and principles

– Risk governance• Risk identification, evaluation and monitoring, reduction measures

2. Business Strategies & Risk Governance

– Developing a Rating system:• e.g. indicators of preparedness, sustainability and resilience

– Measuring resilience:

• Matrices of the top 10-15 disaster prone and the top 10 best resilient countries in Asia and the Pacific based on – Legal, regulatory and policy frameworks, including fiscal management– Institutional frameworks, including stakeholder mapping– International or regional cooperation

– Assessing resilience • Assessment businesses’ overall preparedness and resilience level• Differential considerations between SMEs and large businesses

3. Incentive Frameworks– Defining government’s role and responsibilities

– Assessing incentive frameworks in Asia-Pacific• Monetary measures

Taxation & grants; insurance pools and risk sharing; investment incentives; etc.

• Non-monetary measuresInfrastructure development; technical assistance; industrial

zones and estates; business continuity plans; etc.

– Economic impacts of incentive frameworks

– Required regulatory and institutional frameworks

Multi-stakeholder Consultation

Questions?• Based on the suggested framework, are

there any particular areas which correspond to your business’ DRR needs or strategies?

• What areas of this framework do not meet the needs or interests of your organization?

• What topics would you suggest to expand on? Are there any topics which were not covered that you feel are important?

• What are the biggest challenges facing your organizations’ in relation to DRR?

• Other comments or suggestions?

Framework Review1. Situation Analysis: Private

Sector and Overlapping Risks

2. Disaster Risks For Business

3. Business Strategies and Risk Governance

4. Best Practices and Methodologies of Incentive Frameworks

5. Policy Recommendations (based on 4 areas of coverage listed above)