59% of UAE Firms Report Over $500K Losses Due to Inadequate Business Continuity Plans
As organizations in the Middle East grapple with an increasingly unpredictable operational landscape, recent research from Optro (formerly AuditBoard) highlights a troubling disparity between perceived resilience and actual performance during disruptions among UAE firms. This disconnect raises significant concerns about the preparedness of these organizations in the face of potential crises.
Alarming Statistics on Disaster Recovery Preparedness
The study reveals that only 19% of UAE organizations have a formal disaster recovery plan in place, marking the lowest figure globally and falling short of the global average of 31%. Furthermore, just 38% of these organizations have established recovery time objectives (RTOs) and recovery point objectives (RPOs) for all critical business processes. Alarmingly, only 22% have fully mapped their critical business processes to the necessary technology systems, third-party vendors, and supply chain dependencies.
Despite these shortcomings, confidence levels among UAE organizations remain high. Approximately 73% of respondents expressed assurance in their ability to meet established recovery objectives during a major disruption, while 79% felt confident in demonstrating operational resilience compliance to regulators.
Reality Check: Performance During Disruptions
However, the reality for organizations that faced significant disruptions in the past year paints a different picture. A staggering 62% failed to recover within their established RTOs, with over a third (34%) exceeding their recovery targets by more than double the planned timeframe. The activation of business continuity management (BCM) plans also proved challenging; 42% of organizations could not activate their BCM plans within the first 24 hours of a major incident, and only 15% managed to do so within the first four hours.
The financial repercussions of these inadequacies are substantial. Over the past two years, 59% of UAE organizations reported losses exceeding $500,000 due to various disruptions, including vendor outages, supply chain interruptions, IT and cloud service failures, and weather-related events. Richard Chambers, Senior Advisor for Risk and Audit at Optro and former CEO of The Institute of Internal Auditors, noted, “The findings reveal a dangerous resilience gap. Many organizations have confidence in their preparedness, but confidence alone does not reduce downtime, protect revenue, or accelerate recovery.”
The Role of Third-Party Resilience
The research underscores third-party resilience as a significant contributor to operational risk. More than 82% of respondents indicated that a third-party outage or failure had caused considerable disruption to their operations within the last two years. Among these organizations, 67% estimated that the resulting business impact exceeded $1 million. However, visibility into third-party continuity preparedness remains limited, with only 31% of UAE organizations reporting full visibility into BCM plans for critical vendors—this is the lowest figure globally and significantly below the international average of 49%.
Awareness vs. Operational Readiness
These BCM challenges persist despite a strong awareness of global resilience standards and frameworks. High levels of familiarity with frameworks such as DORA (78%), G-SIB requirements (92%), and SR 14-1 (85%) were reported among UAE respondents. This suggests that while organizations are aware of best practices, this awareness is not translating into operational readiness.
The study also highlights effective practices from organizations with successful BCM programs during disruptions. Key contributors to their success included regularly testing and updating plans prior to incidents (44%), robust management of third-party continuity risks (41%), and clearly defined and tested decision-making authority and crisis communication processes (35%).
Investment in Business Continuity Management
Encouragingly, organizations appear willing to invest in addressing these gaps. Nearly 47% reported an increase in BCM budgets over the past year, and 51% expect spending to rise over the next two years. According to Optro, these investments will be most effective when combined with independent validation and continuous assurance practices. Notably, nearly one in four UAE organizations have never subjected their BCM program to formal external validation or audit.
Chambers remarked, “Recent events across the region have reinforced a reality that disruption can emerge from many directions and often with little warning. Whether organizations are dealing with geopolitical uncertainty, third-party failures, cyber incidents, or operational outages, resilience cannot be assumed. It must be tested, validated, and continuously improved. The organizations that recover fastest are rarely those with the most confidence. They are the ones that regularly challenge their assumptions through exercises, audits, and independent reviews long before disruption occurs.”
For further insights, visit the original reporting source: securitymea.com.
Keep reading for the latest cybersecurity developments, threat intelligence and breaking updates from across the Middle East.
