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Volume 29, Issue 4

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Can Your Company Be Liable For Not Making DR Plans?

Written by  Yatish Mishra Wednesday, 21 November 2007 23:49

Recent domestic terrorism has increased the awareness for the immediate need of disaster recovery. Yet, many high-level executives don’t appear to be making disaster recovery a top priority. That may soon change. In light of current legal developments, companies may be exposing their business, directors, and officers to potential liability by not implementing a disaster recovery plan. The legal issues started to emerge when the federal government authorities began announcing ongoing terrorist alerts. In the eyes of some courts, these warnings could link terrorist attacks with a company’s fiduciary duty to implement programs that protect its human, physical and financial assets against a “foreseeable” event. If a business fails to institute a disaster recovery plan prior to suffering a foreseeable event, such as an act of terrorism, the company could face negligence claims and shareholder lawsuits. As a result, the 60-80 percent of businesses still operating without a formal or tested