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Small organizations are particularly vulnerable to climate change and extreme weather,but theycan take steps to mitigate those risks, according to a
Small Business Majority (SBM)and theAmerican Sustainable Business Council (ASBC) released July 25, 2013.
The report defines small businesses as those with 50 or fewer employees and notes that the Institute for Business and Home Safety estimates that 25 percent of small to midsize organizations do not reopen following a major disaster such as a hurricane or flood.
National Economic Councilestimates about 60 million Americans are employed by small businesses—nearly half of the U.S. workforce.
Unlike large organizations, “small businesses tend to operate out of a single physical location. … [I]n fact, 90 percent of [them] get the majority of their business from within two miles of their front doors,” said Lea Reynolds, report author and senior policy analyst at M.J. Bradley & Associates in Boston.
This makes them more susceptible to economic loss and lasting damage from technological or telecommunications failures, employee absences, power failures, and rising insurance costs, she added.
She noted that a lot of small businesses, many of which consist of only a few people, have not been able to engage in any kind of careful risk management analysis; in fact, 57 percent have no disaster recovery plan. Among those that have continuity or risk management plans, 90 percent spend less than one day a month preparing and maintaining them, according to the report.
Reynolds was among the speakers at a
that focused on the following six case studies of small U.S. businesses:
The case studies conducted from October 2012 to July 2013 featured businesses that are ASBC or SBM members.
Climate change and extreme weather are beginning to influence business decisions at The Saunders Hotel Group, said Tedd Saunders, chief sustainability officer at the third-generation Boston-based business.
Boston is prone to storm surges and flooding, and he’s concerned that storms will become more frequent and more severe. If that happens, “It’s really going to have a drastic impact on the financial conditions of our company,” he said during the press conference.
When Hurricane Irene hit in August 2011, it cost his company more than $5,000 in guest refunds. Damage from Hurricane Sandy in October 2012 totaled nearly $34,000 in lost revenue, including property damage, cancellations and refunds. These storms caused weeklong power outages and had “major, major impacts, certainly to that month [they occurred] and to the hotel in general,” Saunders said.
His company has had to decide whether to spend time and money retrofitting properties against catastrophic events by installing retaining walls, for example, to protect expensive equipment housed in basements from flooding.
Big Muddy Workshop Inc. in Omaha was hit by record flooding of the Missouri and Platt rivers in 2011 and suffered the onset of a drought in 2012 that continues today.
President and CEO John Royster incorporates storm water management into the company’s climate preparedness plan. He also invests in his employees’ education to better equip them to deal with the aspects of climate change by providing training on how to incorporate infiltration trenches and rain gardens when working with clients.
The report suggests that collective action by small businesses to reduce their vulnerability “could have an enormous impact on insulating the U.S. economy from climate-related risk.” It recommends the following strategies that owners can adopt to minimize losses from extreme weather:
In June 2013, small-business owners addressed the impact of extreme weather and climate change when they,
along with the ASBC and the Business for Innovative Climate and Energy Policy, met
with lawmakers in Washington, D.C., during Small Business Week. At that time they also signed the
Climate Declaration, which calls on U.S. policymakers to address climate change.
Kathy Gurchiek is associate editor for
Time to Prepare for Hurricane Season,
SHRM Online Safety & Security, June 2013
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