Nicholas Bahr of Booz Allen Hamilton, is an expert in emergency response planning. Silvia Razgova / The National
Nicholas Bahr of Booz Allen Hamilton, is an expert in emergency response planning. Silvia Razgova / The National

Fully prepared for the worst



The two earthquakes in Iran that recently sent tremors rippling across the UAE caused a certain amount of alarm if not minor panic. They showed that a number of organisations are not as prepared as they should be to handle a disaster. Farther afield, the explosions in Boston and the subsequent manhunt for the perpetrators raised questions in cities around the world about just how prepared they would be in the face of terrorist attacks.

Nicholas Bahr is the regional manager of the Middle East office of the consultancy Booz Allen Hamilton in Abu Dhabi. He is also an expert in emergency response planning. He would like to see better business continuity planning in the UAE and across the Middle East.

This means every government body and business would figure out in advance what their key services are, what the threats are, and what systems could be put in place - and tested - to reduce the effect of disaster. Such a drill would apply in the case of a cyber attack, a natural disaster or a political crisis.

"In the past, a lot of companies have looked at emergency preparedness ... emergency management [and] how to manage after an event and then maybe crisis communication during an event," Mr Bahr says. "Now what we are looking at is different. It's called business continuity: how do you manage your business in the middle of an event. It's sort of building up resilience."

This idea of business continuity is relatively new but catching on. It's also had more importance since the National Crisis and Emergency Management Authority introduced a business continuity standard in December.

This was created by looking at such standards in Britain, Australia, New Zealand, Switzerland and Singapore, in the context of the UAE's activities and services. It's the first business continuity standard in the Arab region.

The situation in the UAE is particularly interesting because of the large number of expatriate workers, according to Mr Bahr. One scenario that needs to be considered is a potential mass flight of foreign workers.

"What happens if expats leave suddenly [in] a mass exodus like what happened with the invasion of Kuwait by Saddam Hussein?" he says. "Here we have things like 70 per cent of the nurses in Abu Dhabi [being] from the Philippines, so imagine if relations between the Philippines and the UAE break down for whatever reason. Then all of a sudden you have a situation.

"Again, I think the concept is: how do I make myself, my company, my government more resilient so that as the vagaries, the unpredictableness of the world occur, I can just respond in a cost-effective and sustainable way?"

While the likelihood of a disastrous earthquake hitting the UAE is small (the country sits in the middle of a tectonic plate rather in the more dangerous location of where two plates meet), Mr Bahr says he noticed some less than desirable behaviours and consequences when separate tremors hit this month.

First, he saw many people evacuate their buildings by taking the elevator. As in the situation of a fire, people should get out of the building via the stairs. Second, he noted that few managers told occupants they could re-enter their buildings. Third, many people jumped in their cars to leave the area only to end up in a gridlock.

Unpredictable events "could be devastating for an economy so it's really important to plan ahead and think about it and test it," he says."This street by noon [last week] was like a parking lot. People just left and got in their cars and went home early; which is fine - but because of the [lack of] coordination there was very little traffic movement and statistically most people have less than a full tank of gas in their car at any one time. So imagine if there is a real call for evacuation: what do you do when cars start running out of gas getting out of the centre of activities?"

Mr Bahr concludes: "I think for me what I would like to see is all of us doing - government and industry together because I am a very firm believer it should be done jointly - is really come up with these business continuity programmes. It's really a joint effort because we are really joint entities now. We are not really black boxes."

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Coffee: black death or elixir of life?

It is among the greatest health debates of our time; splashed across newspapers with contradicting headlines - is coffee good for you or not?

Depending on what you read, it is either a cancer-causing, sleep-depriving, stomach ulcer-inducing black death or the secret to long life, cutting the chance of stroke, diabetes and cancer.

The latest research - a study of 8,412 people across the UK who each underwent an MRI heart scan - is intended to put to bed (caffeine allowing) conflicting reports of the pros and cons of consumption.

The study, funded by the British Heart Foundation, contradicted previous findings that it stiffens arteries, putting pressure on the heart and increasing the likelihood of a heart attack or stroke, leading to warnings to cut down.

Numerous studies have recognised the benefits of coffee in cutting oral and esophageal cancer, the risk of a stroke and cirrhosis of the liver. 

The benefits are often linked to biologically active compounds including caffeine, flavonoids, lignans, and other polyphenols, which benefit the body. These and othetr coffee compounds regulate genes involved in DNA repair, have anti-inflammatory properties and are associated with lower risk of insulin resistance, which is linked to type-2 diabetes.

But as doctors warn, too much of anything is inadvisable. The British Heart Foundation found the heaviest coffee drinkers in the study were most likely to be men who smoked and drank alcohol regularly.

Excessive amounts of coffee also unsettle the stomach causing or contributing to stomach ulcers. It also stains the teeth over time, hampers absorption of minerals and vitamins like zinc and iron.

It also raises blood pressure, which is largely problematic for people with existing conditions.

So the heaviest drinkers of the black stuff - some in the study had up to 25 cups per day - may want to rein it in.

Rory Reynolds

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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