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Alumina Inc and Business Regulations

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Alumina Inc and Business Regulations LAW 529 November 30th, 2004 Alumina Inc and Business Regulations Do you think it is easy to run a $4 billion corporation? Before you answer, first consider that the company we are referring to is located in eight countries around the world, and 70% of their business is here, in the United States. That is the situation Alumina Inc. deals with on a daily basis. Although companies strive to be in that position, there are also a lot of problems that come with being a global company. In order to be competitive, your company has to maintain a positive public image, and be able to manage a crisis instantly. Lawsuits are common for a big corporation because they are thought to have deep pockets, which means they have money to pay out. Alumina Inc. is faced with a crisis that involves a possible lawsuit from a woman named Kelly Bates, who alleges Alumina Inc violated environmental statutes, which led to the leukemia of her daughter. If found guilty Alumina could face high priced fines, and could pay millions to Kelly Bates in damages, along with bad publicity that could upset shareholders. How do you prevent extensive losses- environmental and commercial? That is what our team will try to do as we act as the business manager of the Alumina Corporation. Based on the collective research conducted by our team, we have concluded that our strategy in dealing with the accusations by Kelly Bates, and our report to the key decision maker, Roger Lloyd will be as follows. ...read more.


would we have accepted a mediated settlement with Ms. Kelly Bates, a local resident. The overall team consensus is yes; we feel that a mediated settlement is the best course of action to take in this situation. Five years ago, Alumina Inc. did have an issue and was promptly handled with the guidance of the Environmental Protection Agency approving the steps we did in order to solve the problem of the incident. In today's business environment, many corporations are utilizing the less time consuming and less costly methods to dissolve the disputes they may have with other parties. Corporations have attempted to distance themselves from the time consuming, costly approach of settling disputes through lengthy trials utilizing third-party law firms. According to Coulson (1993), alternate dispute resolution (ADR) employs traditional negotiation techniques, but also includes additional methods of mediation and arbitration. This strategy has proven successful for many corporations in helping to reach prompt, rational and mutually agreed-upon settlements as Coulson (1993) explains further. Corporations have emerged as one of the cornerstones of modern global societies, and with this power come the social accountability demanded by society. Today's corporations are not the same as the corporations of the early twentieth century. Society has seen to that with numerous lawsuits brought up against the willful misconduct and social misbehaviors many organizations have done in the past. This is more prevalent today as the world is linked and interconnected with global media and the use of the internet, so news of any violation is brought up to the public's attention in a matter of minutes. ...read more.


How he uses that weapon is another matter entirely. He can volunteer it as a solution, use it as a fall-back position in negotiation, or oppose the regulation altogether on the grounds that even the best solution is too expensive, but he cannot afford not to know (Fri, 1976, p. 44). The administrative agencies regulating business have a great impact on its operations and ultimately its success or failure. The dilemma with running a multi billion-dollar company is how to run it safely, and with standards that protect everyone involved, including the environment. Our group has come up with strategies in dealing with allegations that could be detrimental to the financial stability of our company. We have talked about other regulations where community stakeholders can make emotional arguments supportive of government intervention. As to the situation involving Kelly Bates; we all feel that a lengthy litigation process dragged through the courts and the local and global media attention will do more harm than good. Even though we could have had a strong case against Ms. Kelly Bates because we have been a social responsible corporation in the past with only one incident, we choose to keep the media away and settle with her. In the settlement, we have agreed that she is not allowed to discuss the charges brought up against us or her settlement will be annulled. When you are known as an industry leader of your product, you instantly become a target for scrutiny and allegations. It is up to the company to make sure they have a good legal team, and that they abide by the statutes put into place by the local government. ...read more.

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