Thoughtfully responding to the novel coronavirus (COVID-19) crisis

The outbreak of coronavirus/COVID-19 represents a significant and ongoing challenge to businesses and community organizations beyond the public health risks posed to communities and individuals and their families. 

Governments and businesses are implementing unprecedented social isolation measures in an attempt to slow the transmission of the virus. A significant number of businesses have asked their employees to work from home. Beside the sobering shockwaves caused by the surge in illness, the outbreak’s legal and business ramifications are certain to be dramatic and, at this point, undeterminable.

As a business disruption, it should be addressed by applying principles applicable to other risks while recognizing that its scale, likely reach, and impact are unique. Responding to the many identifiable legal and business risks associated the pandemic calls for an effective response based on standard risk management approaches and procedures. Although the coronavirus pandemic itself was unforeseeable, it is a disruptive situation which good planning, processes, and effective communication can still help to effectively address.

Organizations need to thoughtfully identify and manage the risks posed by the “crisis” precipitated by this outbreak by implementing their existing crisis response plan. For those businesses that do not have an existing plan, taking the time now to carefully and objectively consider the circumstances and the likely impacts of this evolving crisis on the business is crucial. Each crisis will present its own unique challenges, but any response should be effectively guided by applying a considered, thoughtful, and widely understood approach.

How evolving risks posed by the coronavirus pandemic are identified, communicated and managed requires leadership and nimble, collaborative execution. How businesses approach solutions, and the reasons for such approaches need to be clearly and effectively communicated to all those affected within and outside of their respective organizations.

How to approach crisis decision making

Key characteristics of any effective crisis response plan include: (a) the development and implementation of a systemic approach; (b) making timely decisions in an ordered, calm fashion; (c) leveraging trusted experts in extraordinary circumstances; (d) well considered and effectively executed communication, both internally and externally; and (e) orderly de-escalation at the appropriate time.

Businesses should build or adopt a plan according to their needs. The plan should be flexible enough to adapt to the precise matter at hand.  At a minimum, however, all organizations should:

  • Ensure that a protocol is in place, which can adapt to the situation at hand;
  • Establish and empower a crisis management team that consists of key business leaders who have the appropriate expertise, accountability, and collaborative skills;
  • Ensure there is an accountable “business” point person or persons for identified stages in the plan;
  • Ensure the crisis management team has identified and responsible support experts, such as lawyers, human resources specialists, or other subject matter experts; and
  • Ensure internal and external communications protocols are in place and followed.

Factors that crisis management teams should consider

  • Understand the facts as they unfold:   These are rapidly changed and driven by forces outside of the business.  As governments and health agencies provide updates, businesses need to consider whether their response plans require revision, and what those should be.
  • Communicate:  The approach and any revisions to it should be communicated internally to staff and colleagues, and externally to suppliers, customers, and in certain regulatory contexts, to regulators.  Communication fortifies trust and confidence, whereas confusion leads to turmoil and unnecessary disruption.
  • Be proactive:  Identify areas of potential threats and assess associated risks and anticipate disruption.  This often requires simultaneous considerations from a 360-degree point of view, as well as drilling down on specific relationships, contractual relationships, or governmental/regulatory obligations.  Assessment and sharing insights across the enterprise, with the assistance of internal and external experts, is crucial to the implementation and execution of any contingency plan.
  • Address specific areas that may be, or may become, implicated: Areas that we have considered to date which businesses affected by the coronavirus pandemic should consider include the following:

We continue to actively monitor the situation and identify areas of potential legal and regulatory concern for clients and to offer our observations and perspectives.  We have centralized relevant content that addresses many of these issues on our “Coronavirus: Navigating legal implications and business impacts” Focus Page, which is regularly updated as circumstances demand. 

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Editors

Lawrence E. Ritchie

Partner, Litigation

Alexander Cobb

Partner, Litigation

Shawn Irving

Partner, Litigation

Kevin O’Brien

Partner, Litigation

Lauren Tomasich

Partner, Litigation

Malcolm Aboud

Associate, Litigation