Plan to Recognize and Minimize Regulatory and Tort Risk

Plan to Recognize and Minimize Regulatory and Tort Risk
Samuel Stone
September 13, 2009
Tracey Smith
Plan to Recognize and Minimize Regulatory and Tort Risk
      Companies may expose themselves to risk of litigation or regulatory sanction through intentional or unintentional action or inaction.   Careful evaluation, planning, and action targeting potential risk sources help to reduce exposure to these risks.   A plan to reduce the risk of litigation for Alumina or similar companies follows.
Identifying Sources of Risk
      Sources of risk illustrated in the simulated scenario revolve around potential effects of environmental contamination on the health of the local community.   In the scenario, Alumina operates on the edge of Lake Dira and performs aluminum smelting at the site.   This activity potentially releases what the simulation refers to as “PAH” (University of Phoenix, 2002).   This acronym stands for known as polycyclic aromatic hydrocarbons – these chemicals are either highly toxic or carcinogenic (Government of British Columbia, n. d.).   Alumina previously infringed on regulations governing concentrations of this chemical, but a later audit showed corrected levels.   Legal risks associated directly with release of chemicals include actions by the Environmental Protection Agency for violating regulations as well as tort claims deriving from negligence associated with allowing contamination.
      The simulation highlighted other potential claims associated with reactions to litigation and newspaper articles about Kelly Bates and her daughter.   Investigation of Kelly Bates could lead to invasion of privacy claims and cause emotional distress (University of Phoenix, 2002).   Companies must take care to ensure any acquisition of information does not infringe on the rights of individuals under investigation.
      Even reactions to squelch public outcry may cause negative consequences.   Releasing the entire Environmental Protection Agency report...