Riordan Corporate Compliance Plan
June 11, 2012
James Mc Phail
Riordan Corporate Compliance Plan
Riordan Manufacturing, Inc.
Riordan Manufacturing is a global and international company that produces and sells plastic parts for the beverage manufacturing industry, automotive industry, aircraft manufacturers, and fan manufacturers. Riordan owns four major facilities in the United States Albany, Pontiac, Michigan, and Georgia. In addition, one joint venture located in China, in the town of Hangzhou. Riordan headquartered in San Jose, California is responsible for the creation of new designs, research, and development. The company employs 550 people worldwide, ...view middle of the document...
Riordan should use whenever possible the Alternative Dispute Resolution (ADR) mechanism to resolve disputes and conflicts. By using the ADR, Riordan will reduce or avoid risk of litigation. Research states, “to avoid or reduce these problems, businesses are increasingly turning to methods of Alternative dispute resolutions (ADR) and other aids to resolving disputes” (Chessman, 2010, p. 43). The most common ADR used is arbitration. The parties choose an impartial arbitrator usually part of (AAA) to hear and decide the dispute.
“Enterprise liability is a tort doctrine that holds responsible all individuals or entities engaging in a certain unsafe custom liability for any injuries that results from use of that custom” (Johansen Erika, eHow contributor). Riordan expect its directors and Officers to run ethically and responsibly the company. The employees need to understand that they are personally liable of breach of duty if they do not act or manage responsibly. Training of staff can reduce the exposure of many risks and can help correcting employee’s wrongdoing. Continuous training is necessary because laws are changing and Riordan has to keep up to date their employees.
Riordan could be charge with negligence and breach of duty of care if their medical products cause death or injury. For several months (six to eight months), their Pontiac facility has been producing defective product because of quality issues. They should investigate, correct the situation, and recall the products potentially a risk. It is the duty of the board of directors to oversee and manage the risk of the corporation regarding potential liabilities. Riordan has proposed to move their Hangzhou facility to Shanghai within the next five year to reduce cost. Riordan has to review the local laws, employment laws, and see if there is any potential risk of violation or potential lawsuit following this decision. Using the COSO approach will allow Riordan to manage this process more efficiently and will protect the organization from unforeseen risk.
Real and Intellectual Property
Riordan needs to protect their real and intellectual property rights to protect the millions of dollars of assets. The risk management analysis needs to continuous updating because of newer patents developed and because of laws and regulations changing. Beginning with Real property, all the land, buildings Riordan operates in are properties that need protection from the public and employees. Riordan operates in four locations in the United States, Albany, Pontiac, Michigan, and Georgia; the language of the deed protects the land. Written in the deed is very crucial especially in properties that are abroad. Laws are different in foreign countries and the board members need to be aware of the implications of moving to Hangzhou, China. Risk assessment needs to take place when moving facilities. Saving labor by moving may be one positive, but the company needs...