Having its top management ticked off twice in ten years by the regulators for a spate of environmental incidents is something which no company would relish. For ICI, which still regards itself as a flagship of Britain's manufacturing industry and is a leader of the chemical industry's "Responsible Care" programme, the experience has been doubly embarrassing.
ICI, like much of the chemical industry, has been striving to demonstrate that its releases to the environment and its compliance with regulatory standards are on an improving trend. To be sure, the group displayed a certain arrogance in expecting mute acceptance of its failure - by a very substantial margin - to meet its target of halving its releases in the five years to 1995. But improvement there clearly has been.
These positive signals appear to have encouraged ICI's management to take its eye off the ball. In recent months, a steady flow of pollution incidents at the group's works in Runcorn and on Teesside which, though individually relatively minor, taken collectively should have been sounding alarm bells in Millbank appear to have done nothing of the sort. The three major chemical releases which followed in less than four weeks have now brought the payback for that neglect. The Environment Agency, keen to show that it is a forceful regulator when it has been quite the opposite, has ordered a programme of measures across the group which will demand significant resources and management time (see pp 23-26 ).
The immediate causes of the incidents at ICI's works include a long-standing failure to upgrade the ageing site infrastructure at Runcorn, along with demanning and lack of investment in preventive maintenance and alarms. But the insights offered by a former senior ICI manager (see p 3 ) suggest that the underlying causes go a good deal deeper.
ICI may resent seeing such views given an airing, but in truth there is little in them to which it can reasonably object. Indeed, they offer the solace that the group can share the responsibility for its environmental problems with its institutional shareholders and their demands for rapid returns on investment. It may be somewhat harder for the company to swallow the corollary that the City's pressure for short-term profitability has so shaped its internal culture that its reflex responses to external environmental pressures tend to be defensive rather than forward-looking, but to seasoned observers this analysis has more than the ring of truth.
ICI must know that its major competitors in Germany and Switzerland in particular operate under much less onerous demands from their owners - and that it is no coincidence that they have forged ahead in developing and investing in cleaner and more efficient processes. Other British manufacturing businesses labour under the same source of competitive disadvantage and the same cause of impaired environmental performance - and now has never been a better time for them to speak up for a reform of their relationships with the City.