Business Regulation: Alumina Inc.
Since the creation of the Environmental Protection Agency in the 1970s, businesses in the US have been required to adhere to stringent federal environmental regulations. (Reed, 2005) Alumina Inc., a US-based aluminum manufacturing company, is not the exception. Alumina is faced with the challenge of remaining financially viable, while meeting EPA expectations, as well as stockholder expectations. The following is an analysis of those issues and opportunities as well as a proposed solution to the problems that face Alumina Inc. (University of Phoenix, 2008)
Situation Analysis
Issue Identification and Overview
Alumina Inc. is a USA-based aluminum maker with revenues in excess of $4 billion. Although 70% of Alumina’s sales derive from the USA, the company also boasts a substantial global reach with business ventures in eight countries worldwide. The company has customers, and other business interests, in the automotive components sector, manufacturing of packing materials, bauxite mining, alumina refining, and aluminum smelting.
Due to the nature of Alumina’s business, and the proximity of the company’s factory to Lake Dira, in the State of Erehwon, the company is heavily regulated by the Environmental Protection Agency (EPA). The EPA’s goal is to “protect human health and environment.” (EPA, 2008) In this instance, the agency’s primary purpose is to ensure that Alumina maintains its responsibility to the environment and community by regulating, and monitorying the amount of harmful chemicals released into the surrounding water, air, and soil.
Five years ago, during a routine inspection, the EPA discovered that Alumina Inc. was in violation of environmental discharge norms. The agency’s report stated that ...