In today's global economy, a deadly influenza outbreak in Asia is only a plane ride away from becoming a health crisis in the United States. Avian flu, which has spread from domestic fowl to humans and from Asia into Europe, is particularly threatening. The virus involved, H5N1, is now established in humans and is racking up a mortality rate of about 50%. The avian flu virus lacks just one important characteristic of a pandemic: It is not yet easily transmitted from person to person. But given its recent history and the speed at which it could spread if humans were able to easily infect each other, U.S. companies must start to consider what a flu pandemic would mean for their businesses.

The Congressional Budget Office recently estimated that a severe outbreak of avian flu could sicken 90 million Americans, result in two million deaths and subtract five percentage points from U.S. growth in the year following the outbreak. Yet, recent polls suggest that U.S. companies are not well prepared. Sixty-six percent say they have not adequately planned how to protect themselves in the event of a pandemic flu, according to a survey of 179 companies by the Deloitte Center for Health Solutions and the ERISA Industry Committee, while 14% judge their planning adequate and 20% are uncertain.

Risk management experts say that even companies with meticulous disaster recovery plans need to reassess those plans in light of the possibility of a widespread and very serious disease. It's a question of scale, according to Robert Wilkerson, global leader of the corporate preparedness practice at risk consultants Kroll Inc. He points to companies' experiences with Hurricane Katrina as an example. Many companies were prepared to lose access to their offices or facilities for a week or two weeks, Wilkerson says, but few had planned what to do if they lost access for months. "In a pandemic, we're talking about broad scale illness, loss of critical personnel and many deaths," he says. "Those are things that affect not just the company but the marketplace. Companies are having to look at their plans and procedures and think how much to change and when to change."