Reference no: EM131523622

Question: Chlorofluorocarbons (CFCs) are chemicals used as refrigerants in air conditioners and other cooling appliances, propellants in aerosol sprays, and in a variety of other applications. Scientific evidence has been accumulating for some time that CFCs released into the atmosphere can destroy ozone molecules in the ozone layer 15 miles above the earth's surface. This layer shields the earth from dangerous ultraviolet radiation. A large hole in the ozone layer above Antarctica has been found and attributed to CFCs, and a 1988 report by 100 scientists concluded that the ozone shield above the mid-Northern Hemisphere had shrunk by as much as 3% since 1969. Moreover, depletion of the ozone layer appears to be irreversible.

Further destruction of the ozone layer could lead to crop failures, damage to marine ecology, and possibly dramatic changes in global weather patterns. Environmentalists estimate that approximately 30% of the CFCs released into the atmosphere come from aerosols. In 1978, the U.S. government banned their use as aerosol propellants, but many foreign governments still permit them. Some $2.5 billion of CFCs are sold each year, and DuPont Chemical Corporation is responsible for 25% of that amount. In early 1988, DuPont announced that the company would gradually phase out its production of CFCs and that replacements would be developed. Already DuPont claims to have a CFC substitute for automobile air conditioners, although the new substance is more expensive.

Questions: Imagine that you are a DuPont executive charged with making the decision regarding continued production of CFCs.

1. What issues would you take into account?

2. What major sources of uncertainty do you face?

3. What corporate objectives would be important for you to consider? Do you think that DuPont's corporate objectives and the way the

company views the problem might have evolved since the mid-1970s when CFCs were just beginning to become an issue?