Thursday, 27 January 2011

Bhopal: pinning down responsibility

Bhopal is to India what Chernobyl is to the Ukraine: a catastrophic accident that lives on not just in the minds but in the physical bodies of those affected.

At least, 3,800 people died (unofficial figures are nearly double) when the US-owned Union Carbide factory sprung a toxic gas leak back in 1984. Thousands more were crippled. Even today, hundreds of children in Bhopal are born with congenital birth defects.

There is little debate who was at fault, as Asia editor Rajesh Chhabara explains in a detailed account of the incident in Ethical Corporation’s recent Classic Case Studies briefing. Union Carbide (now a fully owned subsidiary of chemicals giant Dow Chemical) tried alleging sabotage by a disgruntled employee. No evidence has ever emerged. Instead the facts point to sloppy safety measures brought on by cost cutting and management oversight.

The Bhopal disaster highlights an interesting and largely unacknowledged aspect of corporate responsibility: namely, how ill defined its borders still remain. Just where does ‘responsibility’ start and where does it stop?

Technical responsibility clearly falls at Union Carbide’s door. It was the company’s over-full holding tank that leaked. Legal responsibility should be equally as clear. It’s not. At the time, the US headquarters of Union Carbide said it wasn’t responsible for day-to-day operations of the plant. That fell to its subsidiary, Union Carbide India Limited, in which it had a 50.9% stake. Union Carbide eventually paid up $470 million in compensation, but said its legal liabilities ended there.

As for the personal responsibility of the company’s management, Union Carbide’s chief executive has deftly dodged any number of civil and criminal cases. Seven other senior executives were recently found guilty, two and a half decades after the event. All obtained the right of appeal, as Chhabara observes in his blog. So no-one - neither the company nor those charged with running it – are left carrying the can.

Where things get really confusing is moral responsibility. In paying up, Union Carbide says it met its “moral obligations” to the victims. Campaigners say the payment was immorally low (roughly $1,000 for every victim). There’s still the clean up bill to think about too.

As the guilty party’s current owner, does Dow Chemical have a responsibility to meet Union Carbide’s shortcomings? It’s a biblical conundrum – the son paying for the sins of his father. Technically the case is clear. A flat ‘no’. Legally, the answer is less clear-cut. Dow Chemical did, after all, see fit to meet Union Carbide’s asbestos liabilities in the US. Double standards, campaigners say. Not our mess, Dow Chemical replies.

Is it time to change the rules? Should, as Ethical Corporation asked five years ago, the rules of limited liability be changed for cases of gross social and environmental damage?

This tragic story does have one silver lining. As Chhabara points out, the Bhopal gas tragedy woke the international chemicals industry up to potential safety hazards. Under the ‘Responsible Care’ programme, launched in the wake of the disaster, the industry now boasts a comprehensive certification system.

To quote from the initiatives own statement: “Responsible Care is a commitment, signed by a chemical company's Chief Executive Officer (or equivalent in that country) and carried out by all employees, to continuous improvement in health, safety and environmental performance, and to openness and transparency with stakeholders.”

Nothing on the scale of the Union Carbide leak has happened since. The question of who should take ultimate responsibility for the Bhopal crisis, and how, remains unresolved. However, the lessons of responsible management have – hopefully – been learned.

1 comment:

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