Union Carbide: The Unfinished Business at Bhopal - Case Study Example

of the of the Concerned 2 December 2008 Union Carbide: The Unfinished Business at Bhopal Private sector corporations exist primarily for profit motives. There is no denying the fact that private firms do adhere to certain ethics and social norms. Still the very truth that the survival of any successful and viable corporation is ultimately dependent upon the state of its balance sheet makes it more then vulnerable to a glaring betrayal of ethical and social concerns, if the needs be. There exist ample amount of documented evidence and reports that qualify the fact that private corporations have time and again compromised on the acceptable standards of integrity and honesty to bolster their profits and to ensure their sustainability (Chris 12). Even the crucial and vital concerns like statutory provisions, environmental laws, social norms, business ethics and general well being of the society are more then often compromised by the corporations to achieve their fiscal and marketing targets (Chris 16). Any well informed citizen with reasonable levels of exposure to the print and digital media will conclusively testify to the fact that more then often corporations have been found to be willing to damage the world to make more money. This deliberate willingness to hurt the human values by any individual or institution definitely deserves the concern and intervention of a civil society based on democratic values and ideals. The US based corporations, being a part of a thriving capitalist and democratic society, aught to be held responsible for the breach of statutory provisions and public trust committed by them. However, the primary problem hampering this ideal is the fact that the corporations have over the years, assimilated themselves into the society in a way that does not extend the people with specific rights and mechanisms to facilitate a close scrutiny of their day today operations. The very framework and design of the corporations extends them with the ability and power to side step or sideline the public intervention or interference. Public institutions run by the tax payers' money are constitutionally accountable to the masses and the people do have the power to comment on the validity of the decisions taken by them, though indirectly through the provision of voting and adult franchise. The private corporations tend to differ from the state institutions in the sense that they are not liable to seek the approval and validation of the masses as they are privately funded and managed. Besides the enormous funds and political power that they have at their disposal makes them practically immune to public opinion and concern. Infact such an arrangement stands to be a grave injustice to any free and democratic society. The society can not and should not be denied the right to have a say in the affairs of such big and powerful concerns like private sector corporations. This heavy handedness of the US based MNCs becomes even more unrestrained when it comes to doing business in the third world nations. Not only the statutory and monitoring arrangements in the third world countries are often vulnerable to outside influences and powers, but the rampant corruption in such nations makes it relatively easier for the private corporations to bypass and ignore the public well being, environmental laws and business ethics (Basu 34). Even if their misdeeds and blunders get exposed owing to the media activism, the massive clout and influence that the US corporations enjoy in the federal and state legislatures facilitates them with ample government backing and support, which is sometimes sufficient to snub or scare away the state and private objections and resistance. At the end of the day, the corporations have to prove it to their stockholders that they are making huge profits. This quest for profit motivates and lures the corporations to exploit and manipulate the loopholes existing in the arcane laws and administrative structures in the third world countries. This more then often results in them showing a scant regard for environmental concerns, public safety, corporate propriety and labor laws. Union Carbide is one such US based MNC whose conscience is tainted with the blood of many innocent Indian citizens. Before one elaborates on the grave legal and human atrocities committed by this corporation, it will be relevant to delve into the background of this firm. Union Carbide Corporation is an American firm that specializes in the manufacturing of specialized chemicals and polymers and has over 3,800 employees on its roles (Union Carbide). The website of this company boasts of it being a leader in the advanced processes and catalyst technologies. In addition it claims to be utterly efficient in the sterile corporate parameters like cost efficiency and managing state of the art production facilities around the world (Union Carbide). Thus the self proclaimed credentials of this firm declare it to be a private corporation obviously run for profit motives. The polymers manufactured by this corporation are used to make a variety of products like packaging materials, household products, textiles, oil and gas products, wires and cables, paints and varnishes, pharmaceuticals, agricultural products like pesticides, etc (Union Carbide). Superficially this corporation seems to be doing a great service to the society and the world in general, till one alludes to the name of the Indian city of Bhopal. Bhopal gas tragedy was the biggest ever industrial disaster that occurred in the history of the industrialized world. Bhopal is a small city located in the state of Madhya Pradesh in India. Most of the people in this slow paced and tranquil city were sleeping sound on the morning of December 3, 1984, totally oblivious of the fact that death was advancing towards them, slowly but surely. That night 42 tonnes of Methyl Isocyanate leaked out from the storage tank of a pesticide plant, owned by the Union Carbide, which exposed at least 520,000 people who called Bhopal their home to disastrous consequences (Kurzman 34). This biggest ever man made disaster killed more then 15,274 Indian citizens and inflicted partial or debilitating injuries to more then 5,000 people Kurzman 35). This pesticide plant was established in Bhopal in the year 1969. It was being used by Union Carbide to manufacture a pesticide called carbaryl, which required the usage of an extremely hazardous chemical component called Methyl Isocyanate. If intended Union Carbide could have used some less hazardous raw material. However, the usage of Methyl Isocyanate was preferred by the corporation owing to its low cost. Unions Carbide was well aware of the toxic nature of this substance (Carol 61). Still it decided to go ahead with its usage to reduce the overall cost of production (Carol 63). On the night of December 2, 1984, somehow, large amounts of water entered the tank used to store Methyl Isocyanate at this plant. This caused the tank to get overheated beyond the threshold level and the resulting increase in the pressure caused Methyl Isocyanate to leak out of it. Experts believe that the chemical reaction that caused this increase in the pressure was manifold accelerated by the presence of iron sourced to the non corrosive and non stainless steel pipes being used at this plant (Chauhan 12). Various theories exist pertaining to the reason how water managed to enter this tank. Union Carbide tried to put the entire onus for this disaster on the malice of an estranged Indian employee. However, it failed to corroborate this claim with authentic and credible evidence. Various enquiries conducted over the years eventually established that the negligence and the greed of the staff and the management at Union Carbide were responsible for this unprecedented disaster. Union Carbide took advantage of the lax safety guidelines and monitoring procedures in India to reduce its cost of production by resorting to unprofessional and irresponsible maintenance procedures and by using the low quality and substandard construction material. This American corporation deliberately used Methyl Isocyanate, despite being cognizant of its highly toxic nature, owing to pure pecuniary reasons, thus compromising the safety and well being of its staff and the people residing in Bhopal. Attempts were made to cut the cost of construction at this plant by storing such a hazardous chemical component in one big tank instead of safely storing it in multiple and well scattered storage facilities. The material and the pipes used in the construction of this plant were non corrosive and substandard and had rusted and were damaged over the years. The fact is that the large scale production at this plant had ceased in the year 1980, yet no initiative was taken by this unethical and unprofessional corporation to neutralize or transport the Methyl Isocyanate stored in this tank in a professional and harmless way. The safety procedures at this facility owned by Union Carbide were blatantly ignored and no effort was ever made to make ample investments, so as to ensure the proper maintenance of this plant. Infact it was found that the temperature gauge in that tank was dysfunctional on the night of the disaster and the safety procedures at this plant was shut down a long time ago. Actually such a manufacturing facility using toxic substances should not have been established near a thriving city like Bhopal to begin with. Besides, there exists a well documented history of sporadic disasters and accidents within the plant, before this tragedy occurred. The workers and the management at this plant were thoroughly aware of the risky environment rampant at this plant. Thus Bhopal was sitting on a ticking time bomb and eventually became a victim to this saga of greed, avarice and meanness. Infact when one thinks of the people who survived this tragedy, one certainly considers the dead to be really lucky. Those who were spared by Methyl Isocyanate had to bear with severe and debilitating health problems for the rest of their lives. The economics of compensation and rehabilitation of this disaster appears to be a ridiculous and cynical comedy written by the hands of an unconcerned and apathetic corporation. The Indian government asked Union Carbide to pay $ 3.3 billion so as to compensate more then 500,000 affected people (The Nation). However, the Supreme Court of India, in 1989, directed the Union Carbide to pay $470 million in damages (The Nation). This seems utterly absurd when one considers the fact that this corporation managed to recover more then $450 million as insurance coverage for this disaster (The Nation). After paying this paltry amount, the stockholders of this company had to bear a loss of merely &0.50 per share (The Nation). This compensation paid by the Union Carbide was far less then the $600 million it planned to spend in upgrading its two plants at Texas and Louisiana the very same year (The Nation). On the contrary, the share prices of this corporation shot up by $2, the very day this settlement was finalized (The Nation). Hence, one more US corporation managed to deal with a moving human tragedy in a ruthless and business like fashion and actually ended up making profits through this unmatched mayhem. Certainly it stands to be an audacious and unscrupulous betrayal of the human values that the US democracy stands for. There exists no doubt pertaining to the fact that the US is a world leader whose stature is widely respected by the international community. The scope of this leadership extends not only to the political and economic arena, but also to the realm of ethics, values and justice. Hence something must urgently be done to stop the unscrupulous tactics resorted to by the US based corporations in the third world countries, which not only endanger the environment, rule of law and the lives of many innocent people, but also compromise the reputation of US as a responsible democracy (Cassels 24). Mere moral concern will not do. Efficient regulatory mechanisms must be put in place to monitor and direct the functioning of the US based corporations in the third world countries. Specific legal provisions must be legislated to ensure the accountability of the US based corporations operating in the third world before the US justice system (Cassels 57). In a globalized word, business is about trust and credibility and no corporation has the right to smudge the reputation of the US people and a number of responsible and ethical US based corporations with its misdeeds and covetousness. Total Words: 2,020 Works Cited "About Us". Union Carbide Corporation. 2 Dec. 2008 . Basu, Amrita. "Bhopal Revisited: The View from Below". Bulletin of Concerned Asian Scholars, Vol. 26 (1994): 33-49. Carol, S. Wood. "The Bhopal Saga: Causes and Consequences of the World's Largest Industrial Disaster". Environmental Health Perspectives, Vol. 113 (2005): 57-65. Cassels, J. The Uncertain Promise of Law: Lessons from Bhopal. Toronto: University of Toronto Press, 1993. Chauhan, TR, et al. Bhopal the Inside Story- Carbide Workers Speak Out on the World's Worst Industrial Disaster. USA: The Apex Press, 1994. Chris, Robertson. "Developing Corporate Codes of Ethics in Multinational Firms: Bhopal Revisited". Journal of Managerial Issues, Vol. 10 (1998): 11-21 Kurzman, D. A Killing Wind: Inside Union Carbide and the Bhopal Catastrophe. New York: McGraw-Hill, 1987 "Poison gas, up two bucks". The Nation. The Nation Company L.P. 1989, Highbeam Research, 2 Dec. 2008 . Read More