The contract that ISS has with the building complex where almost 160 people died last week in Hong Kong’s deadliest fire disaster in decades is likely to put the global facility management company under scrutiny, according to reports. 

In a client note, UBS analysts Nicole Manion and Rory McKenzie said the stock valuation drop of almost 8% that the company faced after the fire reflects investor uncertainty over whether Hong Kong authorities will investigate the company’s culpability for the fire in the complex, which houses almost 5,000 people, Investing.com reports.

“A potential investigation … is likely to heavily scrutinize every company with responsibilities at the site, including Denmark’s ISS,” the report says.  

The company, one of the largest in Denmark with a market capitalization of more than $5 billion and a growing player in the North American facilities management market, released a statement after the fire saying it has a contract with the complex to provide administrative support, but that doesn’t extend to overseeing the renovation that was being done when the fire broke out.

“ISS EPPL was not involved in the appointment of the construction contractor and was not responsible for the oversight of the renovation,” the company said. “That responsibility rests with the appointed professional consultant and the registered construction contractor.” EPPL refers to EastPoint Properties Limited, the wholly owned ISS affiliate that provides property management services at the complex, called Wang Fuk Court.  

In its administrative support role, ISS arranges for specialist services to be carried out by third parties, it said in its statement. But while it arranged for the renovation services to be completed by the contractor, it played no role in selecting who would do the work.

“These third parties are selected and appointed by the owners,” ISS said. 

The company said it supports any investigation into the cause of the fire. “ISS EPPL is cooperating fully with the authorities and providing access to relevant information,” the company said. “This remains our immediate priority along with support for residents.”

In a statement to Facilities Dive, Nicole Stenclik, spokesperson for ISS North America, said the scope of work property managers do in Hong Kong is generally narrower than in North America and the work is better thought of as administrative services.  

“These services are commonly referred to as property management in Hong Kong, but ... they are not as broad as the typical understanding of property management here in North America and [are not] the same level of responsibility and authority,” she said. 

The fire is believed to have started in the netting surrounding the building scaffolding, which a New York Times report says wasn’t up to code.

“Some of the scaffolding netting … was replaced with cheaper material,” the Times report said. 

Possibly to fool safety inspectors, a small amount of netting on the lower part of the scaffolding was code-compliant while the rest of it was made from a cheaper material, the report said. 

In addition to the netting, investigators are looking at the use of polystyrene boards to cover the building windows, a CNN report says. “These polystyrene boards are extremely inflammable and the fire spread very rapidly,” Andy Yeung, Hong Kong’s director of fire services, said in the CNN report. “Their presence was unusual so we have referred the incident to the police for further enquiries.”

Also under scrutiny is the use of bamboo for the scaffolding, which is common in Hong Kong, although critics have been calling for an end to its use because of fire risk. 

“The technique has been facing mounting scrutiny for its safety and durability,” CNN says. “It is … combustible and prone to deterioration over time.”