Hostage to Fortune in  High Risk Regions
Despite the fact that the risk of corporate kidnap and ransom is on the increase, the subject remains one, which corporations prefer not to discuss. Kevin Stringer suggests that when balancing the costs with the possible downside potential, firms should consider that bodyguard executive security in high risk but lucrative markets. In the business world, return on investment is directly proportional to risk - higher the risk, the greater the return. With this in mind, corporations go far a field into emerging markets to reap their rewards, despite a variety of business risks. A recent study by Arthur Andersen showed that many organizations are taking their first steps onto foreign shores. More than four out of five Fortune 500 companies have plans to expand into emerging markets while smaller companies in sectors such as the telecommunications industry are experiencing accelerating globalization pressures which call for expansion into the developing world. Besides the normal economic and political risks involved in conducting business in developing countries, there is another risk which is much more personal - the kidnapping of high level corporate employees. The estimates for corporate kidnappings in 1999 showed about 1 800 instances where ransom was requested. This figure represents a rise of approximately 6 percent from the 1 700 reported kidnappings in 1998. There is no clear indication of how many of these kidnappings were directed specifically against foreign businessmen or corporate employees. One company's estimates showed approximately 800 expatriates kidnapped during 1995 - 1999, with financial demands ranging from US$50 to US$90 000 000. This is not a subject most corporations want to discuss because of the adverse publicity it might generate for the company, thus these figures might be just the tip of a much larger problem. Nevertheless, the kidnapping of corporate employees is a very real and present danger when traveling in high-risk countires. Recent concrete examples of this phenomenon include the kidnap, torture, and brutal murder of three expatriate engineers of the medium - sized British company Granger Telecom in Chechnya in 1998. A similar incident occurred in 1997 when four executives of Union Texas Petroleum were abducted and murdered in Pakistan. Both incidents mad headline news and cast a pall over business endeavors in these areas. Based upon 1999 statistics, the top ten countries for ransom kidnappings were in the order of occurrence: Columbia, Mexico, Russia, Brazil, Nigeria, Philippines, India, Ecuador, Venezuela, and South Africa. In general there are two main catergories of kidnapping. The first type of kidnapping is carried out by criminals to raise money for their enterprises. Examples of this sort of corporate kidnapping occur in Russia, where foreign companies are often prey for all types of extortion and blackmail, kidnapping being just one variety. Given the continued predilection for corruption among governments in the former Soviet Union, as well as the strength of the Mafia organizations in these countries, these regions could see a steady rise in this type of kidnapping in the future. The second type of abduction is perpetrated by extremists or terrorists who are motivated by political, religious, ethnic, or social causes. Examples of this variety include the incident in Philippines in 2000, when 21 foreign tourists and resort workers were kidnapped by a Muslim terrorist group in Malaysia and held in the southern part of the Philippines. As more countries in the emerging part of the world, such as Central Asia or South East Asia, degenerate into an anarchy of ethnic violence and enclaves controlled by criminal cartels where the central government can not exercise law and order, this type of kidnapping could become more prevalent. Regardless of the motivating factors, business executives are targets for both types of perpetrators. Given the nature of their work and the high-risk return ratios they find in the emerging markets those in the mineral extraction, oil, chemical, and finance business are, from a sector perspective, the industries most confronted with a high probability for the abduction of their employees. Corporate nationality also plays a role in the targeting process, with primary victims often being Western European and particularly American due to either political or economic reasons. In order to reduce the likelihood of kidnapping, a strategy of both passive and active measures can be taken by the corporate executive and his employer. A first step at the company level is to conduct a thorough risk assessment of three factors: the region in question, the nature of the assignment itself and its exposure to risks, and the personnel deploying to overseas assignments either for short business travel or longer term duty. This step is extremely important as variations of risks within a country or even a region or city must always be considered. For example, some cities like Johannesburg, South Africa, have very high violent crime statistics but can be safe if routes and workplace locations are chosen carefully. For the individual executive, a list of the key passive activities to prevent kidnapping is as follows: Whenever possible use non-stop flights provided by well-known airlines between major airports. Be cautious of idle conversations with seat neighbors Have a colleague or known business associate meet you at the airport or arrange a hotel taxi. Avoid kerbside taxi services. In general, travel by private car is generally the safest mode of transportation. In may countries it is advisable to use local and trusted drivers who have a better knowledge of the area and risks Contact local company representation immediately on arrival at the destination and give them the details of you itinerary. Check in regularly with the designated local contact Book hotel rooms using your own name and not the company's in order to remain inconspicuous Keep a low profile in terms of attire and appearance. An executive of a Fortune 500 company is an attractive target, so "Dressing down" is a good idea, but avoid corporate clothing at all costs. Although an inconspicuous profile may be difficult in some countries due to ethnic or racial differences, at least avoid expensive suits, jewelry, and watches. Eat at recommended establishments. Watch when drinks are poured outside of good hotels and restaurants due to the danger of doping. This cautionary advice is especially important in nightclubs, discos, and bars where criminal elements often target foreign businessmen. If you are covered by kidnapping insurance, keep it confidential Avoid prostitutes. They can be used to entrap and executive in a kidnapping situation In general, the chance of a corporate kidnap victim being killed is relatively low, with the risk of death being about 10 percent. With expert advice from any of the several reputable risk control and crisis management firms, this statistic drops even further. The greatest risk to a corporate kidnapping victim actually comes from a botched rescue attempt by local law enforcement or military units in emerging market countries. As for the payment of ransom, all security advisors recommend no handing it over immediately, but rather gaining time through extended negotiations in order to build a better picture of the kidnappers and possibly reach a release of the victim without harm and for reduced payment. Clearly, the safety of the victim is paramount at all times. Swift payment of the ransom only encourages kidnappers to kidnap again, and a company that pays immediately runs a strong risk of handing over the money and not getting the employee released. Given the risks, for liability reasons, no major corporation will send a senior executive out to a volatile region of the world without a comprehensive insurance and security package. Often, a key component of this more active security package is bodyguard services, also known as executive protection services. Naturally, by its very nature, the executive protection business is one given to confidentiality and discretion in terms of services offered, training methods, and operations in order to preserve both client and service provider integrity. Nevertheless, a qualitative overview of these services is helpful when considering active measures to prevent executive abductions in high-risk countries. Firms active in these services often get referrals by word of mouth. As always the client company or individual should perform the necessary due diligence on the executive protection service provider prior to awarding a contract or job. Two firms that are representative of this security sector are ArmorGroup and bodyguard services international. Both companies provide a comprehensive range of services international. Both companies provide a comprehensive range of services in the executive protection and close protection area tailored to the specific corporate or individual need, but have slightly different approaches to the provision of services. In terms of size and organization fro example, ArmorGroup employs 5 500 staff working in 38 countries. This extensive network of overseas offices and contacts can ensure protective arrangements in any part of the world where the "principal" (terminology for the party requiring protection) needs to be. Commercially, ArmorGroup's management have been involved in the planning and implementation of executive protection programs over the past two decades in: the Middle East, Turkey, Bosnia, Russia, Germany, Algeria, Angola, DR congo, South Africa, Cote d'lvoir, Colombia, Venezuela, Ecuador, Thailand, and elsewhere. ArmorGroup's clients for Executive protection services have included managers in global husinesses, consulting/accounting firms, financial services, telecoms, oil and gas and entertainment sectors. Bodyguard Services International has an organizational structure similar to one of the largest, most successful private investigating firms in the world. When the client hires one o their bodyguards, he works for the client - not the firm. Confidentiality is almost a religion with Bodyguard Services International. To quote Bryan Wright of the company "Our bodyguard's lives are their own. We protect their privacy; they protect their client's privacy, and we - in return - expect them to protect ours. In terms of recruitment, generically, both companies tend to recruit for the same profile. Personnel for close protection work usually come from a military Special Forces background and have experience in close protection during their military service. Others come from police and law enforcement agencies (for example in the UK ex Royalty protection of special branch). In Russia most are from military Special Forces or the KGB as well as anti-terrorist units within the interior and police structures. For executive protection skills, police, military, martial arts, wrestling, weapons experience etc. can all be positive factors; but thirty years in the Special Air Service (SAS) makes a good trooper, police experience makes a police good officer, and karate experience can create a champion. These factors, while important, do not necessarily qualify an individual as a bodyguard, but they are valuable secondary traits. The aggressive mind-set must be replaced with an awareness of close-personal protection as a profession that stresses non-confrontation. This simply means that the bodyguard's responsibility is to keep his client from harm's way and to never be forced into a dangerous conflict. If a bodyguard keeps his thought in the forefront of his techniques, this awareness is what can turn thrity years in the SAS into a positive asset. It is the same with police or military experience - learn the theory of non-confrontation and these can be valuable experience backgrounds. Depending on the contract, personnel backgrounds can vary extensively. In South America for example, ArmorGroup uses ex Police Special Task force personnel with experience at looking after senior government members, etc. one member of the team is always a qualified paramedic. In terms of training, most bodyguards are selected for their existing skills. All are proficient in firearms (although will not normally be armed on assignment) and have a basic level of medical knowledge. Personnel are carefully selected to cover the wide variety of skills needed - for example, if a client has any particular medical problem, the selected close protection team would give emphasis to increased medical expertise/capability. Personnel also have capabilities in a wide variety of languages, including sign language. In preparation for certain assignments, Bodyguard Services International, for example, runs refreshers and in-house training, more so to get the teams used to each other and sometimes gain a familiarity that has been forgotten - with firearms for instance. For corporate executive mandates, most firms employ a mix of full time employees and contractors. Team leaders are often full time employees but other staff is sub-contracted. Other bodyguard firms employ specialists for contract duration. A critical reason for this approach is frequently business driven. For example if four bodyguards are employed on a full time basis for executive protection work, they have to be paid even when work is slow. If a new contract comes in that differs from previous mandates, the company would have to use them for that contract rather than recruit the best suited for that obligation. Length of assignment varies for corporate executive protection from one day to a week, but there have been occasions where cover has been provided for a matter of months or years. Close protection services can also be provided on an "on call" basis - in one instance this took the form of 1 week, every 6 weeks for a 10-year period. In terms of the size of the protection detail, the number of bodyguards assigned depends on the client firm, the individual, and more importantly, the risk. Depending on the role the executive is filling, the location, and the business dealings he is involved in, he could go with two specialists, and still manage to keep a low profile in local surroundings. On the other hand he may need six bodyguards around him depending the threat assessment. One bodyguard company has for example a six-man protection team on an individual in Africa and also a two-man team on another principal in Africa - both are high risk assignments but treated differently based upon various factors. Fees for executive protection can range from US$225 to US$3000 per man per day depending on the risk and location plus costs and expenses. As a rule of thumb, low risk assignments start at around US$300/US375 per day, medium risks at US525/US675, and high risk at US$1200/US2250. all these figures are daily rates, additional costs include travel, expenses, insurance, incidental expenses, accommodation, etc. People tend to think that executive protection is a service offered to people traveling in the world's more notorious trouble spots. But increasingly, firms are asked to provide executive protection services within industrialized countries as the risk of kidnap and ransom threats increase. Regardless of the geographical location, the kidnapping of executives is a reality for businesses today. Several initial measures can be taken to reduce this risk by means of risk assessment and individual precautions. On a more active level is the use of executive protection specialists from a reputable firm. When balancing the costs with the downside potential - death or injury of a valued employee, adverse publicity, possible litigation from victims or their families, etc. - firms should consider that bodyguard services maybe an inexpensive solution for corporate executive security in high risk markets.