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Global Issues in Environmental Management

Part A.

a.      One of my fundamental problems with the Australian National Report is that while there is a broad and comprehensive discussion of the manner by which decisions and actions can be made on a national and international level in such a manner as to distribute the impacts and responsibilities with justice and equitability, very little attention is afforded to sustainability. It is essentially lacking in any progressive conception of environmentalist policy, one which guarantees that the present way of life can continue without expending an ultimately finite planet.

There is no attention to renewable energy, cradle to cradle engineering or retrofitting the consumer economy and industrial production. I think this is a very substantial oversight, for while it is all well and good that it measures accountability in relation to issues of conservation, environmental preservation and the prevention of degradation, it does not actually pay much attention to whether present modes of economic or industrial development are actually feasible within a world of limited resources and limited space. Sustainability should be crucial to the dogma of any environmental proclamation, as while it is nice to think of all the environmental amenities we are ensuring to keep alive and well in

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a post-industrial nation-state, sustainability is important to making sure that anthropogenic biomes can exist without degrading the environment and without compromising wealth and luxury.

What this oversight ultimately suggests is a tellingly conservative notion of environmentalism which presumes that human interests are necessarily contrary to the health and welfare of the planet and its natural resources, and while I hesitate to talk in abstract metaphysics, this strikes me as silly as evolution OR creation would not design or psychology or physiognomy for a planet that cannot contain us, nor would we be expected to share the same space as other creatures. This is the very worldview that pretty much gave the environmental movement undermined its leverage in the first place. We were designed for this planet, so why is it impossible for us to live in it comfortably without compromising its well-being? A principle of sustainability and a political commitment to it is the kind of affirmation necessary to future decisions that must be made in developing our industries and our way of life in such a manner that is both green-friendly and human-friendly.

b.      I believe the precautionary principle is also outdated. While it wisely maintains the necessity of intervening in favor of preventing environmental degradation as well as attacking their causes, I believe it is not radical enough. While some would favor the pro-actionary principle, which suggests that action should be taken instead of caution, I would favor the reversibility principle as espoused by Jamais Cascio. Cascio maintains that the precautionary principle is criticized for its emphasis on worst-case scenarios and disparages the potential benefits of controversial technologies, while the pro actionary principle invests too much in the predictability of actions.

However, he insists that both arguments are valid and ultimately reconcilable and in the face of rapid technological developments, a “’do it’/’don’t do it’ argument” does not take into account the fact that the complexity of problems we face cannot be reduced to simple binaries. Cascio proposes the reversibility principle, asserting that a crucial point in determining actions to be taken (or not) and technologies to be implemented (or not) is the extent to which it can be undone. As such, designing and planning of these decisions and technologies must have a built in ‘undo-ability,’ such that potentially unforeseen negative impacts can be reversed or shut down.

Part B.

a.      What are the likely effects of the Montreal Protocol and the report of the Ozone Trends Panel on the market structure of chlorofluorocarbons? On the political marketplace? The Montreal Protocol, by virtue of capping and subsequently reducing the allowable production of chlorofluorocarbon up to a point where production does not exceed zero, would effectively render the chlorofluorocarbon industries non-existent. However, before this happens, the initial years would see the chlorofluorocarbon market enter a phase of radical changes to its production, in the form of strategic adjustments to production output. As such, chlorofluorocarbon producers such as Du Pont have a set allowance of production by which they can address the demands of the market.

The demand may not experience the same limits, but the extent to which they can meet it is severely dampened. The immediate effect of this would be far from trivial to the industries that have come to rely on such compounds… industries such as refrigeration, food packaging, structural insulation and solvent manufacture. However, regardless of what production decisions are made, the caps set by the Montreal Protocol would lead to significant short-term increases in the price of chlorofluorocarbons (insofar as demand would outweigh supply in the face of an absence of substitute compounds). Furthermore, less-developed countries not afforded exemptions from the Montreal Protocol would encounter minor hurdles in modernization and industrialization that is until substitute compounds are developed to accommodate the aforementioned chlorofluorocarbon-dependent industries.

b.      What are the implications for Du Pont? What are Du Pont’s options? As evidenced above, Du Pont is faced with radical alterations to the means by which it is able to derive revenue from the above mentioned industries. Chlorofluorocarbon restrictions present Du Pont with the following options: take no action and permit policy-making to run its course (whether that results in restrictions or not), make an in-house strategic decision such as ceasing production or maintain an active stance in favor or opposition of regulation.

However, because some form of regulation is inevitable, inaction would be unwise, as it would be of strategic interest to not only to anticipate policy, but identify which policy is most likely to emerge in order to optimally determine the best course of action. In-house strategic decisions would be inevitable, especially since some form of regulation (miniscule or drastic) would be expected. In order to best control the outcome of policy, it would be in the best interest of Du Pont to maintain some form of stance in order to best expedite the kind of policy they choose to favor, one which will most definitely require to make some form of adjustment to the operations of their Freon Division.

c.       What would you recommend that Joe Glas do? Why? My recommendation is that Glas favor the development of alternative compounds. While the costs of research and development are most certainly a hurdle that must be taken seriously, they are not insurmountable and they would be in the best interest of Du Pont. First of all, there is tremendous political goodwill to be harnessed from the development of alternative compounds. By presenting itself as the industry leader in the development of applied chemistry towards ozone neutral (or ozone positive) applications, it reaps a significantly positive image it can use to curry market benefits. Additionally, the costs of research and development will in the long term be offset by the benefits to be had. Consider the possibility that regulation could bring the burden of taxation on chlorofluorocarbon sales as a form of “regulatory rent” designed to offset “windfall profit”. This would negate any short term profits to be made by a spike in the market price of chlorofluorocarbons, and it would therefore be in Du Pont’s best interest to develop an alternative that cannot be taxed under such environmentally protectionist circumstances.

Furthermore, long term investment in alternative compounds would see the disparity between costs of production come down to meet the demand for CFCs (and substitutes) that is only increasing as the markets expand and countries develop, in such a manner for it to be able to achieve a market-viable price. Joe Glas’ best course of action is to confront this dilemma than attempt to forestall threats of regulation, especially when they are so emboldened by an increasingly environmentalist zeitgeist.

d.      This case is relevant because while environmental issues are of paramount importance, it is impossible to design a realistic scenario of sustainability and environmental preservation in which humanity is included without properly recognizing the need to examine the underlying forces that govern industrialization and modernity. By carefully scrutinizing these forces, it becomes possible to realize sustainability without compromising modern luxury and material prosperity by retrofitting the flaws of these systems that create such environmental impacts in the first place. Because Du Pont is a chemical engineering company whose very operations are intertwined with a vast number of industries and products that are central to our way of life, critical examination allows us to best understand how one company’s operations – environmentally damaging or not – can be so integrated into other things we take for granted, and therefore best exemplifies a case in which it becomes necessary to measure industrial environmental impacts while still taking into consideration the interests of industrialization itself. Industrialization is not, in and of itself, an environmentally negative presence so much as it operates on assumptions that are only now revealing themselves to be damaging.

As Alex Steffen opines, “[We] trash the planet not because we’re evil, but because the industrial systems we’ve devised leave no other choice. [They] were conceived before we had a clue how the planet works. They’re primitive inventions designed by people who didn’t fully grasp [their] consequences.” Environmentalism failed to gain much currency as a global movement, simply because it called for conservation and restraint, asceticism and frugality, when the reality is no one wants to go back to a world without high definition plasma screens and high speed automobiles, and the Du Pont scenario challenges us to think about the ways by which industrialism can meet environmentalism.
Bibliography

Reinhardt, F.L. & Victor, R.H.K. (1996) Business management and the natural environment: cases and texts, South-Western College Publishing, Cincinnati, Ohio, pp. 1.7–1.36.

Department of the Arts, Sport, the Environment and Territories on behalf of the Australian Government (1991) Principles for international decisions and actions, Australian National Report to the United Nations Conference on Environment and Development, AGPS, Canberra, pp. 231–40.

Steffen, A. (2006) The Next Green Revolution, Wired Magazine, May.

Cascio, J. (2006) The Open Future: The Reversibility Principle, Worldchanging, March 6. Retrieved August 5, 2008 from: http://www.worldchanging.com/archives//004174.html

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