Journal number 12 – The Ozone Threat: Managing with Uncertainty

For this week’s class we were assigned to present our case study regarding the case that involved Dupont which discovered Chlorofluorocarbons (CFCs) in the early 1900s and was its largest producer globally until 1987 when the company decided to phase out its CFCs division. During that time, the chemical became a necessity in every household as a refrigerant for air conditioners and as aerosols. On the other hand, in the manufacturing industry CFCs are used as solvents. At the time of the case, the CFC market is an $8 billion market which DuPont enjoys having the biggest market share globally.

DuPont as a company also played a great role in America’s success story. In fact, in both World Wars, DuPont was the largest supplier of gunpowder for the US military. They were even the ones that produced the plutonium used in the atomic bomb. Aside from this, other products that made DuPont one on America’s top companies over the past two centuries are their development of nylon and Kevlar. Currently, they hold about 25,000 patents globally and have one of the world’s best R&D capabilities.

Crux of the case:

In the time periods between 1970s and the 1990s, there were several scientists who came up with studies regarding the Ozone layer. Some of them found that CFCs especially the ones being used as aerosol are the main culprits behind the widening of the Ozone Hole while other scientist came up with the opposite result. In other words, there were was already a consensus that something bad is happening to the ozone and some scientific minds claim that CFCs contribute to the ozone depletion, however, there was no concrete scientific basis during those times.

What made the case sensational is that scientists found out that a mere five percent decrease in the ozone levels might lead to 8,000 new cases of skin cancers. Also, CFCs lives are between 20 – 100 years which makes their potential adverse effect to the nature irrevocable if proven later on which actually happened in 1987. As there was no complete agreement in the scientific arena about the potential adverse effects of CFCs to the ozone layer, DuPont argued that they should be allowed to continue production of CFCs until such time a concrete study is done to prove its adverse effects. This is even though the safety of all inhabitants of Earth will be put at risk and in uncertainty.

To complicate matters further, some groups claim that even before the Montreal Protocol and the recorded widening of the Ozone Hole in the Artarctic, DuPont has already developed technology for safer alternatives (Hydro fluorocarbons or HCFCs) but chose not to shift production in order to increase demand and ultimately increase its price.   Also when a local ban in the US was put in place, DuPont instead of completely abiding shifted its focus on developing countries which has no ban in place. Thus it really squeezed what it can from CFCs before it phased it out of the market despite its potential adverse effects to the environment.

Conclusion:

As I have stated in our presentation, it was not easy approaching this case as no entity or person was really held responsible over the adverse effects done to the ozone. We tried exploring DuPont’s point of view in aftermath of the case, however, we discounted it eventually as it was hard to think that DuPont will become a better citizen of Earth. This was based on our research that after this case the company was also involved in another case involving disposal of toxic wastes in deep in the earth that led to the poisoning of water supply for 131,000 people in Delaware in the US. Before all of this, the company was also involved in the production of Tetraethyl lead (TEL) that caused the decrease in IQ of two generations of Americans. Just as the previous cases mentioned, DuPont made every single way possible to keep production of this products even to the extent of establishing dummy organizations to deceive the public.

In the end, we conclude that the problem with DuPont is the integrity of management. They were ready to make decisions as long as they can justify its legal even though it’s not ethical and sustainable for the environment. Based on our research, the company still remains one of America’s biggest and influential companies at the same time being among the dirtiest ones as well. This made us approach the case as how should the company make a decision that is ethical and sustainable for all stakeholders during the period that there was scientific uncertainty about the adverse effects of CFCs to the ozone layer.

We recommended that DuPont should have completely shifted to the production of alternatives immediately while still investing in R&D for superior alternatives as it was later on proven the HCFCs are also considered as an Ozone Depleting Substance (ODS) later on but is more environmentally friendlier than CFCs. DuPont may argue that it will have significant impact to their profits, however, based on our research this will only be temporary especially in the short-term because at that time they were the only ones that have this technology and is in position to dictate and lead the market. By doing so, they will be able to protect their profit margin and most importantly keep people’s safety and the safety of the future generation which will also be the source of the company’s future profit.