The Legality of Risk Management - Research Paper Example

The Legality of Risk Management Introduction The Bhopal gas tragedy, which account for the lives thousands of innocent people in 1984 was caught theattention of the public few days ago because of the controversial findings and punishments by the Bhopal court against the culprits. Union Carbide, the American company which created the damage and Warren Anderson, the then chairman of Union Carbide Corporation of USA, who lives in the United States, appeared to have gone scot-free as he is still an absconder and did not subject himself to the trial. The court has punished few employees of the Union carbide for two years jail term for a crime which resulted in the killing of more than 15000 people (Bhopal gas tragedy: Accused awarded only 2 yrs in jail, get bail, 2010). Bhopal gas tragedy was an industrial catastrophe in which the toxic gases leaked out of the Union Carbide India Limited pesticide plant in Bhopal in 1984. Methyl isocyanate (MIC) gas and other toxic gases liberated from the plant affected around 500000 people staying nearby. Another controversial aspect of this accident is the fact that even after 25 years of gas leak accident, still tons of chemicals left abandoned at the accident sight which is contaminating the groundwater in this region. The above accident is one of the better examples in which how injudicious industrialization may harm the interests of the public. Moreover, this accident teaches us how carelessly the big companies handling the industrial equipments which can cause severe damages to the human life. The importance of human life is nothing for such greedy industrialists and even after killing many people, these industrialists were able to escape from the severe punishments. This paper briefly analyses the Bhopal gas tragedy case and provide recommendations to avoid such tragedies in future. Bhopal Gas Tragedy: Analysis The Bhopal gas tragedy happened purely because of the human errors and handling of risky equipments with carelessness. The Union Carbide report after the accident indicates that purely technical negligence and personal negligence caused this tragedy. A stainless steel tank emplaced in concrete contained probably 45 tons of liquid Methyl isocyanate (MIC). The Union Carbide Manual calls MIC (CH3N = C = O) "an extremely hazardous chemical.. by all means of contact" and regards it "as an oral and contact poison" even though it is not classified among poisons. It is also "extremely flammable." Most probably, water got into the tank through a pipe. The MIC, which reacts violently with water, turned into an explosive gas vapor that blew out the valves in its path. The event was a constrained explosion, not a leak, and the explosion formed a cloud which blew downwind over Bhopal. It was the simplest of occurrences: a tank of volatile liquid, a violent reaction with water, a prolonged explosion of gas through a pipe and out (Causes and Negligence, n. d) It is evident from the above description that the tragedy occurred 100% because of careless handling of toxic chemicals. Union Carbide has given no respect to the life of the villagers staying near the plant in case of an accident. Union Carbide Pesticide plant from where the gas leaked belonged to Union Carbide India, a subsidiary of the US-based Union Carbide Company. US-based Union Carbide Company was asked to pay compensation and arrange for medical treatment. But the US Company and its CEO refused to take any responsibility for this accident. Moreover, the CEO of Union Carbide at that time, Warren Anderson escaped from India and argued that it is impossible for the Indian courts to take a case against him. The question of who is responsible for this tragedy was a controversial one. The American Company refused to take responsibility of this tragedy and the American CEO escaped from any punishment. NDTV (2009) has strongly criticized the judgment quoting comments even foreign medias. The Times, London blamed Indian government for their inability to punish the former American CEO whereas The New York Times said Indian courts are notoriously slow. The Times online went a step further, claiming the Bhopal verdict shows that the wealthy can outwit Indias judiciary (NDTV, 2009) Varma, (2009) has mentioned that on an average, 6,000 gas-affected patients visit hospitals in Bhopal every day, that is, about 2 million visits per year (Varma, 2009). In other words millions of people are still facing the problems associated with the gas tragedy. Even then the American company is keeping a blind eye towards such issues and staying away from helping the innocent people with adequate medical care or financial aids. Corporate social responsibility is a big talking point in the industrial word nowadays. Bhopal tragedy definitely contributed to such thinking in the industrial word. It is an accepted fact now that the industrial units established in a location should have a commitment towards the people in that location since the company is exploiting the local resources. In other words, each profit making organization should spare some percentage of their profits for the wellbeing of the society. Moreover, it is the responsibility of the organizations to take utmost care in ensuring the safety of the people around the organization. In case of an accident just like the one happened in Bhopal, the company should take full responsibility of it and should compensate for the damages caused to the innocent people. In Bhopal tragedy case, no such goodwill was expressed by Union Carbide or its CEO. Executive summary If I was in charge of the issue, definitely I will try to provide as much as compensation and help for the suffered people. I will never stay away from the moral responsibility of this issue as a CEO of Union Carbide and will do everything possible to reduce the damage. Warren Anderson has questioned the authority of Indian legal system to prosecute him in this regard since he was an American. But he is forgetting the fact that everybody is equal in the views of law and order. It is foolishness to argue that Americans can commit crimes in India and the Indians don’t have the authority to prosecute them. Union Carbide should have taken enough precautions even before the establishment of the plant. They should have taken another remote location for establishing this plant considering the possible dangers associated with a probable accident because of the toxic chemicals involved in the plant operations. It is a fact that even people slept in the Bhopal railway station were killed because of the gas tragedy which reveals the proximity of the plant to the public gathering places. Only Union Carbide knows the chemicals handled by them inside the plant and the possible accidents in handling such chemicals. So, they should have taken enough precautions while handling these materials. Even when the gas leakage occurred, instead of immediately informing the public about the tragedy, the management tried to hide it which resulted in heavy casualties which could have been reduced. It is impossible to avoid the above tragedy using any of the risk financing techniques. Risk financing techniques can only reduce the volume of the damage up to certain extent by providing adequate financial assistance to the people suffering from the accidents. Insurance coverage for the employees and the people around the company could be an option considered by the Union carbide. But the company failed to provide such protection to the public which resulted in the affected people getting nothing as compensation from the company. Union Carbide should stop all the operation of its units near the heavily populated areas. They should realize that it is impossible for them to control the spreading of toxic gases in case of an accident and hence they should strengthen their security measures along with the relocation of the plants from heavily populated areas to remote population less areas. Periodic inspection of the safety measures and the updating of the technology and equipments may prevent the accident up to certain extent. The employees should be given adequate training about the handling of equipments and chemicals and they should also be given training for handling situation in which an accident occur at the industrial unit. Conclusions Risk management is a complex task because of the various interests involved in the accidents. In the Bhopal gas tragedy case, the Union carbide company tried to safeguard their interests alone and gave no value or respect to the human lives. Organizations should exhibit their corporate social responsibility properly and they should never stay away from their responsibilities if an accident occurs due to their negligence. Sometimes it is impossible to prevent an accident, but it is possible to reduce the damage if the timely interventions were made by the organization. References 1. Bhopal gas tragedy: Accused awarded only 2 yrs in jail, get bail, (2010), Retrieved on 9 June 2010 from http://news.rediff.com/slide-show/2010/jun/07/slide-show-1-bhopal-gas-tragedy-verdict.htm 2. Causes and Negligence, (n. d), Retrieved on 9 June 2010 from http://www.grazian-archive.com/governing/bhopal/Bhopal_C6.html 3. NDTV (2009), Bhopal verdict: World media blames govt, judiciary, Retrieved on 9 June 2010 from http://www.ndtv.com/news/world/bhopal-verdict-world-media-blames-govt-judiciary-30618.php?u=0838 4. Varma Subodh (2009), Bhopal Gas Tragedy: Endless nightmare, The Times of India, Retrieved on 9 June 2010 from http://timesofindia.indiatimes.com/india/Bhopal-Gas-Tragedy-Endless-nightmare/articleshow/5294330.cms Read More