Analyze problems of steel company in article below and propose potential solutions. Instructions Analyse the case study using the following…

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Recommends specific strategies

to accomplish the proposed solution.

Dirty Business…

A Foreign steel factory in the Southern province of Vietnam, is causing major controversy.

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On March 2nd 2018 the very profitable Japanese owned factory was authorised to resume activity after it had been closed by local authorities for three weeks. Local authorities had closed the factory due to several protests caused by allegations of severe air and water pollution by local residents.

Following a thorough investigation by the environmental administration of the province, it was concluded that minor water and air pollution had been released into the environment, but these were compliant with national environmental laws and were under the authorised limits.

M. Sumimoto, CEO of the Steel Company, explained in press conference that the company is “very concerned about local residents wellbeing and the environment, and always strives to adopt the most environmentally-friendly processes and best practices”.

However, local residents and environmentalists have conducted their own investigation, and came to the conclusion that very toxic chemicals had been release in the local river; and according to their water testing results, toxic chemicals levels are 50 times higher than regional and international authorised standards.

Environmentalists from 2 foreign NGOs have anonymously declared to online media sources that over 2000 households were directly exposed to toxic air wastes and that many residents and farmers downstream will also suffer from the consequences of intoxicated waterways. They also highlighted that “more research needs to be produced to understand longer term impact of the toxic water on agriculture and food production downstream”. Most farmers pump water directly from the river for irrigation.

Large tax income generated by the factory and the 1600 jobs at stake was raised by local residents as reasons for the local authorities to grant the permission to resume operations.

According to internal information, local management of the factory has received strong pressure from shareholders to pursue activities, as relocating the factory and pausing operations for many months would cause major losses for the company and would dangerously affect customer relationships.

Several major customers in Europe and Japan have already expressed their concerns on the negative externalities of their supplier, and have announced that they will take into account production practices when selecting steel suppliers.

Experts from the steel industry have developed cleaner methods to produce steel, but today those techniques require heavy investments from producers.

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