问题详情

SectionA–ThisONEquestioniscompulsoryandMUSTbeattempted
HesketNuclear(HN)isanuclearpowerstationinAyland,alargeEuropeancountry.TheHNplantisoperatedbyHesketPowerCompany(HPC),whichinturniswhollyownedbythegovernmentofAyland.Initiallyopenedinthelate1950s,thepowerstationgrewinsubsequentdecadesbytheadditionofseveralotherfacilitiesonthesamesite.HNnowhastheabilitytogenerate5%ofAyland’sentireelectricitydemandandisoneofthelargestnuclearstationsinEurope.Ateachstageofitsdevelopmentfromthe1950stothepresentday,developmentonthesitewaswelcomedbytherelevantlocalgovernmentauthorities,bythebusinessesthathavesupportedit,bythetradeunionthatrepresentsthemajorityofemployees(calledForwardTogetherorFTforshort)andalsobythenationalAylandgovernment.Anuclearreprocessingfacilitywasaddedinthe1980s.ThisisavaluablesourceofoverseasincomeasnuclearpowerproducersinmanyotherpartsoftheworldsendmaterialbyseatoHNtobereprocessed.Thisincludesnuclearproducersinseveraldevelopingcountriesthatrelyonthecheaperreprocessedfuel(comparedto‘virgin’fuel)thatHNproduces.
HPCisloss-makingandreceivesasubstantialsubsidyeachyearfromthegovernmentofAyland.HPChasprovenitselfuneconomicbutisdeemedpoliticallyandenvironmentallynecessaryasfarasthegovernmentisconcerned.ThegovernmentofAylandhasreluctantlyacceptedthatlargesubsidiestoHPCwillbenecessaryformanyyearsbutconsidersnuclearpowertobeavitalcomponentofitsenergyportfolio(alongwithotherenergysourcessuchasoil,gas,coal,renewablesandhydroelectric)andalsoasakeypartofits‘clean’energystrategy.Unlikeenergyfromfossilfuels(suchascoal,gasandoil),nuclearpowergeneratesanegligibleamountofpollutinggreenhousegas.HNalsoprovidesmuchneededemploymentinanotherwisedeprivedpartofthecountry.TheHNpowerstationunderpinsanddominatestheeconomyofitslocalareaandlocalgovernmentauthoritiessaythattheHNplantisvitaltotheregionaleconomy.
Sinceitopened,however,theHNpowerstationhasbeencontroversial.Whilstbeingwelcomedbythosewhobenefitfromitintermsofjobs,trade,reprocessingcapacityandenergy,acoalitionhasgraduallybuiltupagainstitcomprisingthosescepticalaboutthesafetyandenvironmentalimpactofnuclearpower.SomeneighbouringcountriesbelievethemselvestobevulnerabletoradioactivecontaminationfromtheHNplant.Inparticular,twocountries,bothofwhomsaytheirconcernsaboutHNarisebecauseoftheirgeographicalpositions,arevocalopponents.TheysaythattheirgeographicalproximityforcedthemtobeconcernedastheyareaffectedbythelocationoftheHNplantwhichwasnotoftheirchoosing.
ThegovernmentofBeeland,whosecapitalcityis70kmacrosstheseafromHN(whichissituatedonthecoast),hasconsistentlyopposedHNandhasfrequentlyaskedthegovernmentofAylandtocloseHNdown.TheBeelandgovernmentclaimsthatnotonlydoes‘low-level’emissionfromthesitealreadycontaminatethewatersseparatingthetwocountriesbutitalsoclaimsthatanyfuturemajornuclear‘incident’wouldhaveseriousimplicationsforthecitizensofBeeland.ThereissomescientificsupportforthisviewalthoughopinionisdividedoverwhetherBeelandisbeingirrationalinitsgeneraloppositiontoHN.
ThegovernmentofCeelandisalsoavocalopponentofHN.CeelandislocatedtothenorthofBeelandandapproximately500kmawayfromAyland.SomenuclearscientistshavesaidthatwithsuchalargestretchofwaterbetweentheHNplantandCeeland,evenamuch-fearedincidentwouldbeunlikelytoseriouslyimpactonCeeland.SomecommentatorshavegonefurtherandsaidthatCeeland’sconcernsareunfoundedand‘borneofignorance’.FT,thetradeunionforHNemployees,issuedastatementsayingthatCeelandhadnoreasontofearHNandthatitsfearswere‘entirelygroundless’.
HN’sothervocalandpersistentopponentisNoNuclearNow(NNN),awell-organisedandwell-fundedcampaigninggroup.Describingitselfonitswebsiteas‘passionateabouttheenvironment’,itdescribesHN’ssocialandenvironmentalfootprintas‘verynegative’.NNNhasoftenpointedtoanenvironmentallyimportantcolonyofraresealslivingneartheHNplant.Itsaysthatthesealsaredependentonalocalnaturalecosystemaroundtheplantandareunabletomove,arguingthattheanimalsareatsignificantriskfromlow-levelcontaminationandwouldhave‘nochance’ofsurvivalifamoreseriousradioactiveleakeveroccurred.NNNpointstosuchaleakthatoccurredinthe1970s,sayingthatsuchaleakprovesthatHNhasapoorsafetyrecordandthataleakcouldeasilyrecur.
EachtimeanobjectiontotheHNpowerstationisraised,FT,thetradeunion,robustlydefendstheHNsiteinthemedia,andarguesforfurtherinvestment,basedontheneedtoprotectthejobsatthesite.Furthermore,theradiationleakinthe1970sledtoFTunitingwiththeHPCboardtoargueagainstthosestakeholdersthatwantedtousetheleakasareasontoclosetheHNsite.ThecombinationofunionandHPCmanagementwasabletocountertheargumentsofthoseaskingforclosure.
HNplacesagreatdealofemphasisonitsriskmanagementandoftenpublicisesthefactthatitconductscontinualriskassessmentsandisinfullcompliancewithallrelevantregulatoryframeworks.Similarly,FTrecentlypointedoutthatHNhashadan‘impeccable’safetyrecordsincetheincidentinthe1970sandsaysonitswebsitethatitis‘proud’thatitsmembersareinvolvedinensuringthatthecompanyiscontinuallyinfullcompliancewithalloftheregulatoryrequirementsplaceduponit.
TheboardofHPC,ledbychairmanPaulGog,isundercontinualpressurefromthegovernmentofAylandtominimisetheamountofgovernmentsubsidy.Eachyear,thegovernmentplaceschallengingtargetsontheHPCboardrequiringstringentcostcontrolsattheHNpowerstation.Inseekingtoreducemaintenancecostsontheexpiryofapriormaintenancecontractlastyear,theboardawardedthenewcontracttoanoverseascompanythatbroughtitsownworkersinfromabroadratherthanemployinglocalpeople.ThepreviouscontractcompanywasoutragedtohavelostthecontractandthemovealsotriggeredanangryresponsefromthelocalworkforceandfromFT,therepresentativetradeunion.
FTsaidthatitwasdeplorablethatHPChadawardedthecontracttoanoverseascompanywhenadomesticcompanyinAylandcouldhavebeenawardedthework.Theunionconvenor,KateAllujah,saidthatespeciallyinthenuclearindustrywheresafetywassoimportant,domesticworkerswere‘morereliable’thanforeignworkerswhowerebroughtinpurelyonthebasisofcostandinwhosecountriessafetystandardsinsimilarindustriesmightnotbesostringent.HPCsaidthatithaddonenothingillegalastheforeignworkerswereallowedtoworkinAylandunderinternationallegaltreaties.Furthermore,itarguedthatpressurebyFTtoraisewagesoverrecentyearshadcreated,withthegovernment’ssubsidytargets,thecostpressuretore-tenderthemaintenancecontract.
OnHN’s50thanniversarylastyear,NNNpublishedwhatitcalleda‘riskassessment’fortheHNpowerstation.Itsaidithadcalculatedtheprobabilities(P)andimpacts(I)ofthreeprominentrisks.
Riskofmajorradioactiveleakoverthenext10years:P=10%,I=20
Riskofnuclearexplosionoverthenext50years:P=20%,I=100
Riskofmajorterroristattackovernext10years:P=10%,I=80
Impactswereonanarbitraryscaleof1–100where100wasdefinedbyNNNas‘totalnuclearannihilationoftheareaandthousandsofdeaths’.
ThegovernmentsofBeelandandCeelandseizeduponthereport,sayingthatitprovedthatHNisagenuinethreattotheirsecurityandshouldbeimmediatelyclosedanddecommissioned.HN’sriskmanager,KeithWan,vigorouslydisagreedwiththisassessmentsayingthattheprobabilitiesandtheimpactswere‘ridiculous’,massivelyoverstatedandintendedtounnecessarilyalarmpeople.HN’spublicrelationsofficewasalsoangryaboutitandsaiditwouldissuearebuttalstatement.
Required:
(a)Distinguishbetweenvoluntaryandinvoluntarystakeholders,identifyingbothtypesofstakeholdersinHesketNuclear.AssesstheclaimsofTHREEoftheinvoluntary‘affected’stakeholdersidentified.(12marks)
(b)Thetradeunion,ForwardTogether,hashadalongrelationshipwithHNandrepresentsnotonlythemainworkforcebutalsotheemployeesofthemaintenancecompanyreplacedbytheforeignworkers.
Required:
Explaintherolesofemployeerepresentativessuchastradeunionsincorporategovernanceandcriticallyevaluate,fromtheperspectiveofHPC’sboard,thecontributionofForwardTogetherinthegovernanceofHPC.(10marks)
(c)ExplainwhatanagencyrelationshipisandexaminetheboardofHPC’scurrentagencyrelationshipandobjectives.BrieflyexplainhowthesewoulddifferifHPCwasacompanywithprivateshareholders.(10marks)
(d)AsapartofHPC’spublicrelationseffort,ithasbeenproposedthataresponsestatementshouldbepreparedforthecompany’swebsitetohelpaddresstwomajorchallengestotheirreputation.
Required:
Draftthisstatementtoincludethefollowing:
(i)ReferringtotheNNNreport,explainwhyaccurateriskassessmentisnecessaryatHesketNuclear.(8marks)
(ii)Explainwhatasocialandenvironmental‘footprint’isandconstructtheargumentthatHN’soverallsocialandenvironmentalfootprintispositive.(6marks)
Professionalmarkswilladditionallybeawardedinpart(d)fordraftingastatementthatisclear,hasalogicalflow,ispersuasiveandisappropriatelystructured.(4marks)


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