Getting Credit for Having a Business Continuity Plan
Getting credit for having a BCP
This month, U.S. credit rating agency Standard & Poor’s (S&P) started evaluating the enterprise risk management (ERM) capabilities of non-financial companies that it covers. This is S&P’s announcement, and here are their answers to common questions about it.
Extrapolating an ERM evaluation to a logical, eventual conclusion, if a company didn’t have a business continuity management (BCM) program, its credit rating could be lowered. The consequence? Borrowing money would cost more, and for the large companies that S&P reviews, that could be a material consequence.
“What could you do for US$400,000? Could you develop a company BCM program for US$400,000? Could you hire an experienced, certified BCP professional to run it for US$400,000? Set up a recovery site? Could you make a company genuinely more resilient–and therefore more credit-worthy–for US$400,000? As we say in Minnesota, “You betcha!” The benefit side of the BCP cost-benefit equation would be much easier to quantify.”
