Regulatory Risk Plan

Leo Smith

October 17, 2010

Recognizing and Minimizing Tort and Regulatory Risk Plan

Today’s business world is continuously policed by laws and regulations that hold each organization accountable for their compliance of regulatory risks in the workplace. With regulatory risks we have tort liability, tort liability can be controlled by the way companies manage their business and utilize preventive measures. If businesses fail to comply with the laws established by Federal and State governments, then they can suffer the loss of earnings and potentially earn an extremely negative reputation. Businesses that utilize resources and cover all the angles will minimize the risk of tort liability and regulatory risks in general. I will be using the business simulation from our text to understand the issues that Alumina Inc. faced in the previous years. Alumina Inc, is a United Stated based organization operating as a manufacturer of packaging materials, bauxite mining, alumina refining, and aluminum smelting (University of Phoenix, 2010).

In a routine EPA compliance evaluation inspection, Alumina was accused of releasing high levels of environmental discharge that were exceeding the standard level. The PAH concentration levels that were tested were above the prescribed limit which in turn holds Alumina Inc liable. Although the past indicates that Alumina Inc has flawlessly demonstrated environmental responsibility, their reputation is now on the line for a couple of reasons. The first reason being that Alumina failed to correct the recurring incidence by not establishing any type of preventive measure. The second reason is that a single mother by the name of Kelly Bates is threatening to ruin Alumina’s reputation.

Bate’s claims that Alumina has contaminated the waters of Lake Dira with carcinogenic effluents, and has alleged that consumption of the contaminated water is the proximate cause of her 10-year-old-daughter’s leukemia. Bate’s also alleges that her daughter’s...