Does Wildfire Exposure Influence Corporate Disaster Preparedness? A Study of Natural Resources Extraction Firms in Canada

Abstract

Managers must make critical disaster preparation decisions to protect firm assets from the threat of wildfire activity. Prior literature stresses the importance of past disaster experience as a key driver of disaster preparation. The article finds that, while experience with disasters is a critical condition, it is insufficient to explain disaster preparation activities by firms. Managerial perceptions including belief in anthropogenic climate change and the perception of increasing wildfires can substitute for direct negative wildfire experience. The article builds configural theory to explain how the psychological “closeness” of wildfire hazards can influence managerial decisions to prepare for disasters in the presence of key organizational characteristics. This study adopts a qualitative comparative analytical approach, drawing on manager surveys and biophysical wildfire data from 20 Canadian mining and resource extraction sites. The article also contrasts manager perceptions of wildfire risk with those of experts and captures a gap in risk perception.