BP Company Oil Spills - Case Study Example

BP Company Oil Spills Question 1 In April 2010, there was explosion of deep water horizon oil spill by the British Petroleum (BP) Company, which was quite a huge environmental crisis in terms of the oil industry. However, the BP crisis did not only affect the employees but the entire community residing near the Gulf of Mexico, a place where the oil spill occurred. The oil spill was due to a gas leak that was in the oil rig which resulted from the accumulation of hydrocarbons at the Mexican Gulf (Jones 2010). This oil spill led to quite a high number of damages, for instance, hundreds of families were distributed and few deaths were reported. Furthermore, this oils pill led to numerous ethical issues that BP should have addressed, some of this issues are discussed below. The independent scientists and other examiners were denied the opportunity to research and determine the rate at which the oil was spilling by the BP Company. The scientists would have reduced the impact of the oil spill to the community if they would have been given the chance to assess the rate of the spill. Having said this, the ethical issue is, if indeed BP Company denied the independent scientist the opportunity of to examine the extent of the damage caused by the oil spill, then how would the company get to know where the problem was and come to effective conclusions. In addition, it was quite surprising that the government was unable to process the needs of the press and newsmakers to be able to enter into the site that had caused this damage, even though BP Company could have had various reasons for this, it was not fair since it did not follow a transparent process. Therefore, the ethical issue here is that there was no disclosure of information by both the company and the US government to the citizens thus making them to “stay in the dark.” Moreover, the legal security in the Mexican Gulf is incomplete as well as incomprehensive since it did not raise any penalty to the company for causing health and mental related damages to the wildlife living in that area (Freudenburg & Gramling 2011). Therefore, there is an ethical issue of the lack of animal and wildlife protection regulation that would punish the company. In addition, the company did not appropriately take charge of the oil spill situation since they did not give any warnings to the public. Ethically, the company was supposed to show great sorrow and regret as well as the oil spill tragedy instead of engaging itself in multiple blame games. In fact, BP should have worked in coherence with both Halliburton and Transocean, the owner of the rig, to reduce the impact and damage caused by the oil spill. Question 2 In this case study, the stake holders who were affected include the employees, the public, the government, the stockholders and the board members among others (Carroll & Buchholtz 2012). These stakeholders were highly affected by the oil spills, in fact, many members of the board claimed that the investigation carried out by the company and the government was highly unethical since it aimed at hiding important information from the public. Furthermore, the employees were also highly affected thence resulting to the loss of morale since they did not have an idea of how the oil spills would impact their professional careers in the future. Equally, the government was affected since the oil spills caused both mental and physical damages to its people thus making it liable. In addition, the oil spills could affect the economy of the country thus affecting the government in the whole. Ultimately, the stockholders suffered investment damage in the sense that the oil spills would cause a loss to the company thus consequently causing a negative impact on the investments of the stockholders. Question 3 In my opinion, I do not agree with Feinberg’s assertion that you have to draw a line somewhere since in this situation, Feinberg should not be placing too much emphasis on the Florida Law, particularly the Act of Oil pollution since this is more of an ethical issue as opposed to a legal one. Therefore, even though Feinberg is in a difficult situation to determine who should be compensated, he should consider various issues so as to become fair to all those who were affected. Question 4 Feinberg’s appointment by the National Alliance on Mental Illness (NAMI), meant that he was supposed to be the administrator of the $ 20 billion claim fund that was purposed to act as a cover for the illnesses and damages caused by the oil spills. Since the tort low states that mental illnesses should be accompanied by the physical injuries to be considered for compensation, then Feinberg’s decision pertaining physical injuries is correct. Feinberg truly argues that if the people are given the chance to be compensated purely on the basis of stress and anxiety, then there would be quite a high number of applicant who are not legitimate, that would be seeking for monetary gains (Feinberg 2012). This concept slightly affects my answer since the compensation of people who have not genuinely experienced damage could have a highly negative effect on the financial performance of the company. Question 5 Since Feinberg does not have jurisdiction over the claims by the municipalities and states, then assessed the people who have experienced mental damage as a result of the oil spills ought to apply for the compensation claims. The agreement puts it clear that all the people who were either directly or indirectly affected by the oil spill is entitled to compensation and thus, the claimants, inclusive of the municipalities and the state should be compensated appropriately and according to the damage they face. Question 6 If I was responsible for determining the validity of the claims made by the various victims of oil spills, I would look at both the legal and ethical considerations whilst assessing the degree of impact of the damage that a person has suffered. Doing this would create fairness and equality in the compensation process since it is quite ethical that a person who has suffered major losses or damages gets a relatively larger compensation as compared to those who have suffered minor damages. The ethical concepts that would guide my thoughts would include the level of Post-Traumatic Stress Disorders (PTSD), mental issues due to financial problems, and depression levels affecting the people as a result of the oil spills. References Carroll, A. B., & Buchholtz, A. K. (2010). Business & society: Ethics and stakeholder management. Mason, OH: CL-South-Western Cengage Learning. Feinberg, K. R. (2012). Who gets what: Fair compensation after tragedy and financial upheaval. New York: Public Affairs. Freudenburg, W. R., & Gramling, R. (2011). Blowout in the Gulf: The BP oil spill disaster and the future of energy in America. Cambridge, Mass: MIT Press. Jones, J. C. (2010). The 2010 Gulf Coast oil spill. Frederiksberg: Bookboon.com. Read More