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Joanna Fields
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Navigating Cybersecurity on a Stretch of "Regulatory Rapids"

In this shared commentary, Aplomb Strategies writes that when considering a firm’s governance structure, a holistic approach makes the most sense.

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December 18, 2007

Pandemic Flu Exercise Completed

By Alexa Jaworski

Brokerage firms now have a much better idea of how prepared they would be if a pandemic flu hit the U.S. The industry underwent a mock trial in September and October that tested firms' ability to continue to function if high percentages of their staff were unavailable because of a pandemic flu.

About one-fourth of nearly 2,800 financial organizations that registered for the exercise were brokerage firms. One goal of the exercise was to enhance the industry's understanding of the potential systemic risks of a pandemic. Another was to provide an opportunity for firms to test their pandemic plans, as well as the impact one would have on the industry.

Two organizations-the Financial Banking Information Infrastructure Committee and the Financial Services Sector Coordinating Council-were in charge of the exercise.

"Nearly 3,000 organizations from the banking, insurance and securities industries registered for this voluntary exercise, and the number of people participating in the three-week exercise likely was in the tens of thousands," said George S. Hender, chairman of the Financial Services Sector Coordinating Council for Critical Infrastructure Protection and Homeland Security. "The full analysis of the exercise ... has helped the financial services sector be better prepared to meet the challenges posed by pandemic flu."

In a subsequent questionnaire about the exercise, 56 percent of the respondents rated their organization's business continuity plans for a pandemic as "moderately effective," while 28 percent said their plans were "minimally effective."

About 55 percent of the firms said they plan to establish work-at-home capabilities, while 41 percent said they would divide up their business units and disperse them. Twenty-one percent said they would enter into agreements with other organizations. The questionnaire results will be available to the public next year.