group assignment fundamentals of management

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<b>MGT103_Teacher: Du Tieu Duong</b>

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<b>I. Overview...3</b>

<b>1. Formosa Ha Tinh Steel Joint Stock Company...3</b>

<b>2. Situation...4</b>

<b>II. Briefly explain why the action is bad...5</b>

<b>III. The Management concepts...6</b>

<b>IV. The consequences of Formosa’s incident...9</b>

<b>1. Environment...9</b>

<b>2. People’s Life:...10</b>

<b>3. Their customer...12</b>

<b>V. REFERENCES...13</b>

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<b>1. Formosa Ha Tinh Steel Joint Stock Company</b>

Formosa Ha Tinh Steel Joint Stock Company is a steel manufacturing companybased in Vietnam's Vung Ang economic zone. Hung Nghiep Formosa Ha Tinh Ironand Steel Company Limited (FHS), a subsidiary of Taiwan's Formosa PlasticsGroup, is the official name of Formosa.

Formosa began investing in the Son Duong iron and steel complex project in 2008,with a total investment of almost ten billion dollars, and plans to expand capital tonearly twenty-seven billion dollars. The overall project implementation area is morethan 3,300 hectares, including more than 2,025 hectares of land and more than1,293 hectares of water surface area (Son Duong port). The land lease is for 70years, with a total land rent of more than 96 billion VND over the duration of thelease.

FHS registered 11 business lines, some important industries such as manufacturingand trading of iron and steel; port business; Cement Production; trading thermalpower plants and water treatment plants; construction, installation, operation andsales of gas plants, sale of compressed gases, and liquids used in industry such asoxygen, nitrogen...; manufacturing, processing, trading and importing and exportingproducts related to coking coal, tar, light crude oil, and real estate business.

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The complex's iron and steel project, Son Duong Formosa Vung Ang Ha Tinh Group(Project) of the Formosa Ha Tinh Iron and Steel Company (Formosa Ha TinhCompany), was given an investment certificate in 2008 with a total number ofworkers. The total registered capital for the project's first phase is $10,548 billionUSD.

The 2016 Vietnam marine life catastrophe was a water pollution issue in centralVietnam, impacting the provinces of Hà Tinh, Quang Binh, Quang Tri, and Thua

<b>2. Situation</b>

Since as least April 6, 2016, fish carcasses have been washing up on the beachesof Hà Tinh province. Later, on the shores of Hà Tinh and three other provinces(Quang Binh, Quang Tri, and Thua Thien Hue), a large quantity of dead fish werediscovered till April 18, 2016... Formosa Ha Tinh Steel, a steel company owned byTaiwanese business Formosa Plastics, unlawfully released hazardous industrialwaste into the ocean via drainage pipes. After months of denial, Formosa finallyadmitted responsibility for the fish fatalities on June 30, 2016.

On 1 May 2016, Vietnamese residents protested in several cities, advocating for acleaner environment and demanding openness in the investigative process as aresult of the enormous marine life destruction.

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After receiving information about the incident of mass fish deaths in Vietnam in 2016,also known as the Formosa Incident, the Ministry of Science and Technology presidedover, organized data collection and analysis, and had independent criticism. Accordingto international experts, there is a large waste source originating from Vung Ang area,Ha Tinh province, containing toxins such as phenol, cyanide, ... combined with ironhydroxide, forming a mixed complex (Mixel) ), which has a higher density thanseawater, following the North-South current moving from Ha Tinh to Thua Thien-Hue,causing mass death of seafood and marine life, especially in the bottom layer. anddiscovered Hung Nghiep Formosa Ha Tinh Iron and Steel Company Limited-FHS(hereinafter referred to as Formosa Ha Tinh Company) violated, discharging untreatedwastewater causing serious environmental problems, making seafood sudden death,causing great damage to the socio-economic and marine environment; adversely affectpeople's life, security, social order, and safety. This action of company F caused the

<small></small> Mass death of fish in Vung Ang sea (Ha Tinh province) started from April 6,2016, and then spread to the waters of Quang Binh, Quang Tri, and Thua ThienHue.

<small></small> On the coast of Guangdong, Vung Chua, there are hundreds of grouper speciesfrom 40-50 kg drifting ashore and dying.

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<small></small> By April 25, Ha Tinh province had 10 tons, Quang Tri had 30 tons, on April 29,Quang Binh had more than 100 tons of sea fish suddenly died ashore.<small></small> This disaster has a great impact on the production and daily life of fishermen,

on coastal aquaculture households, on sea tourism and on the lives of residentsin the Central region.

<small></small> Quang Binh province alone has 18 communes specializing in marineoccupations with more than 14,000 households and 24,000 marine workers<small></small> VnExpress quoted information from the national tourism agency in November as

saying that waste pollution from Formosa company along the central coast inApril had almost completely destroyed the region's tourism industry whenrevenue from Tourism is down 90%.

<small></small> Affecting the lives of more than 200,000 people, including 41,000 fishermen

<b>III. The Management concepts </b>

Having scientific evidence, concurrently taking advantage of every opportunities, throughmany different channels and measures (political, diplomatic, judicial, informationpropaganda...) to fight and convince, on June 28, 2016, FORMOSA HA TINH STEELCORPORATION (FHS) accepted responsibility for causing environmental problems,causing mass seafood deaths in 4 provinces from Ha Tinh, Quang Binh, Quang Tri, andThua Thien Hue during the period and commit:

 The company needs to apologize publicly to the Government and Vietnamesepeople.

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 Making a commitment to pay damages for economic losses and support careerchange; treating the contamination and marine environment restoration in 4central provinces of Vietnam with a total amount of USD 500 million, equivalentto VND 11,500 billion divided into 2 times, within 3 months.

 Making good the damage thoroughly, accomplishing the production technology,ensuring to dispose hazardous wastes before being discharged into theenvironment by requests of the State management agencies of the centralgovernment and Ha Tinh province to prevent the recurrence of environmentalincidents.

 Coordinating with ministries of Vietnam and Central Provinces to providesolutions to control the marine environment in the Central region, ensuringpollution prevention, and preventing environmental pollution to establish trustwith Vietnamese and international people.

 The enterprise must properly and fully implement the above commitments, notrepeat violations of the law on the protection of the environment and waterresources. if the company breaks the laws, they will be punished in accordancewith Vietnamese law.

- Nowadays, the biochemical and industrial wastewater streams that have beentreated to meet national technical regulation standards at FHS's local wastewatertreatment stations after going through the biological lake system continue to betreated, improving parameters and always meet national technical regulationpermission, and satisfy National technical regulations on surface water quality.

- About the change of coke cooling method from wet to dry (CDQ system) andinstallation of some additional waste gas treatment equipment for the Sintering

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Factory: by March 2019, FHS has put the CDQ system in No. 1 was put into trialoperation, in June 2019, the CDQ system No. 2 and 01 additional exhaust gastreatment equipment for the Sintering Factory were put into operation, and onOctober 2, 2019, the remaining exhaust gas treatment equipment also run.

- In terms of dust, emissions (through taking and analyzing samples and onlineemission monitoring data) at chimneys and exhaust pipes all meet Nationaltechnical regulations.

- In regard to solid waste, FHS has demarcated and classified generated solidwastes and arranged 19 temporary storage areas for waste. Waste management atFHS is classified into the following groups: Non-recyclable, recyclable solid wasteincludes domestic waste, ordinary industrial waste, and hazardous waste which istransferred to appropriate authorities.

- Up to now, all items of improvement and supplementation of environmentalprotection works as required by the Ministry of Natural Resources and Environmenthave been completed by FHS and certified by the Ministry of Natural Resourcesand Environment for official operation.

<b>|Succeeding in solving marine environmental problems|</b>

- Up to now, the exploitation, farming, trading of aquatic products, salt production,beach resorts, and beaches of 4 central provinces have been back to normal.Consumers feel secure when using seafood products. Tourism began to recover,domestic tourists to attractions, resorts, and entertainment during holidays, and Tetincreased significantly. Fortunately, aquatic resources have recovered, many types

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of floating fish such as anchovies, scads, potato fish, shrimp ... have reappeared.The number of fishing vessels at sea has increased slightly.

- Evaluating the results after more than 3 years of repairing the damage, Mr. HoangVan Thuc - Deputy Director of the General Department of Environment (Head of theInter-sectoral Monitoring Team at FHS) said: “Beside troubleshooting and violations,FHS has invested and improved the system to do the best in environmentalprotection. So far, all 53 environmental violations have been remedied, ensuringenvironmental improvement.”

- The inter-sectoral council considers FHS's discharge plan to ensure theenvironment and ensure the criteria. Currently, the additional work items have beencompleted, operated stably, and have been evaluated, certified, and accepted bythe Ministry of Natural Resources and Environment and other ministries andbranches in accordance with the standards and regulations of the law. In addition,Formosa has also invested funds for environmental improvement items at therequest of the Ministry to best protect the environment. Deputy Minister Vo TuanNhan affirmed: “Today, Formosa waste is strictly controlled, the quality ofwastewater and exhaust gas meets regulations before being discharged into theenvironment”.

<b>IV. The consequences of Formosa’s incident1. Environment</b>

The case of marine pollution caused by Formosa company "revealed" from thephenomenon of deaths on April 6, 2016, in the waters of Vung Ang port in theterritory of Ky Anh Town, Ha Tinh Province. The phenomenon of dead aquaticproducts spread on a large scale, starting from the coastal area of Ha Tinh,

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continuing along with the coastal areas of Quang Binh, Quang Tri, and Thua Hue provinces.

Thien-The reason for the ecological episode that caused the mass demise of fish in theseaside spaces of four focal areas was dictated by the Formosa organization duringthe preliminary activity of the plant complex, there was infringement and permittedto occur. Incidents, leading to wastewater containing phenol and cyanide toxins thathave not been treated up to standards and discharged into the environment. Formosa had to admit 53 mistakes, including big mistakes such as arbitrarilyconverting coking technology from dry coking (using inert gas) to wet waste (usingwater). More specifically, in the report of the Vietnamese government, it wasrevealed that: Formosa did not build a filter tank for the biochemical wastewatertreatment plant as the commitment they accepted in the environmental impactassessment report.

Moreover, Formosa Ha Tinh admits to importing a large amount of detergent,because when operating for a long time, it must have detergent to clean thepipeline to avoid clogging. According to Mr. Do Thang Hai - Deputy Minister ofIndustry and Trade, from both 2015 to May 2, 2016, Hung Nghiep Formosa Ha TinhIron and Steel Co., Ltd. had imported nearly 384 tons of chemicals. Including 103chemicals. Particularly from the beginning of 2016 until now, it has been approvedto import 224 tons of chemicals with 43 types of chemicals. From the beginning of2016 up to now, this company has used about 51 tons of chemicals, with 248 tonsof chemicals left in stock. Mr. Hoang Quang, a Formosa diver, said that 21 divers of

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Nibelc International Construction and Labor Supply Joint Stock Company hadsymptoms of seawater poisoning in the Vung Ang area. That much data has shownus the huge amount of waste that Formosa Ha Tinh has brought to the centralcoast.

<b>2.People’s Life:</b>

The Ministry of Agriculture and Rural Development has made statistics of relateddamages after the incident and the impacts on fishing activities. Specifically, thetotal number of fishing boats of the four provinces is 16,444, of which 14,474vessels have a capacity of less than 90 CV and 1,970 vessels with a capacity ofover 90 CV with about 50,000 people directly affected and 176.334 people indirectlyaffected.

For those fishing in waters beyond 20 nautical miles, there are a total of 1,970offshore fishing vessels (with a capacity of 90 CV or more) and 15,800 directworkers, from April 6, 2016. Only 50%-80% of vessels participate in the exploitation,however, the selling price of catches has been seriously reduced. For shipsengaged in fishing in waters within 20 nautical miles, there are 9,212 motorizedfishing vessels under 90 CV (of which 2,249 ships with engines from 20 to under 90CV are) affected. more than 90% of ships have to stay ashore and over 46,060direct workers do not have stable jobs and low incomes; mining productivity is verylow (equal to about 10% compared to before the time of environmental incidents).

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Not stopping at the impact on fishing and seafood exploitation activities,aquaculture activities also decreased, in which the shrimp farming area that wascompletely killed was 5.7 hectares, equivalent to nine million VND. shrimp seed andabout seven tons of commercial shrimp are about to be harvested. Over 3,000hectares of intensive and semi-intensive shrimp culture have stocked but cannotget additional water due to unsafe water quality leading to high salinity in the pond,deterioration of the environment, slow growth of shrimp, the occurrence ofdiseases, and over 350 hectares of shrimp farming died scattered. 3,218 fish cagesdied (about 49,884 m3), equivalent to 1,000 tons of fish.

The Formosa environmental incident also caused many difficulties in the process ofconsuming aquatic and seafood products. The selling price of seafood productsdecreased sharply (average 20%-30% compared to the same period in 2015). Inparticular, the consumption of seafood products from the markets of the fouraffected provinces has decreased significantly. Organizations and individualstrading in seafood have lowered their selling prices, even accepted to sell at a loss,but it is still difficult to sell in the market. On November 4, 2016, the VietnamNational Administration of Tourism announced the operation situation for the first 10months of the year, showing that Quang Binh was the province that suffered themost with the loss exceeding 1,500 billion VND. Nghe An, Quang Tri, Ha Tinh, andThua Thien Hue also suffered tourism damage. The national tourism agency saidwaste pollution from the Formosa company along the central coast in April hadalmost destroyed the region's tourism industry as revenue from tourism fell by up to90%.

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