ETHICS VALUES CORPORATE SOCIAL RESPONSIBILITY: ETHICS VALUES CORPORATE SOCIAL RESPONSIBILITY Anil Ghadge Gajanan Shailendra S.Thakur Definitions: Definitions Ethics: Principles of behavior that distinguish between good & bad, right & wrong. Values: A value is something that has worth or importance to an individual. CSR: All about recognition that organizations have significant influence on the social system, which may be considered & balanced in all organizational actions. Bhopal Gas Tragedy: Bhopal G as Tragedy India in the 1950:s : India in the 1950:s Failure of the crops Attacks by insects Famines The Green Revolution : The Green Revolution Irrigation Fertilizers Pesticides Pesticide production: Pesticide production 1969 Union Carbide Indian Limited (UCIL ) built a plant in Bhopal 51% was owned by Union Carbide Corporation (UCC) 49 % was owned by Indian authorities Design of the MIC-unit : Design of the MIC-unit MIC was used instead of less toxic but more expensive materials Storing of large amounts of MIC in few large tanks instead of several small tanks Safety system inadequate Location close to a densely populated area The alarm system not addressing the inhabitants Many warnings: Many warnings 1974 Contaminated well, cows died 1978 Trade union wrote letter to managers and MP government 1978 Large fire 1981-1984 Many leaks, workers injured, also died. Articles published. Sept 1984 Safety audit by UCC found several shortcomings Abstract: Abstract The case gives an overview of the Bhopal gas tragedy. On December 3, 1984, poisonous gas leaked from Union Carbide India Limited (UCIL's) pesticide plant in Bhopal, which killed thousands of people. The case brings out the ethical issues involved in the disaster & CSR activities carried out. Eye Opening-Facts: Eye Opening-Facts 3787 people dead in 24 hours. 28,000 badly injured most of them due to accidents. 600,000 people affected due to gas related disorders, 38,478 temporary injured while 3900 severely & permanently disabling injuries. Out of 600000 peoples affected, 3000 are pregnant woman & 200000 were below 15 years of age. Over 10,000 lost their eye sight. 2000 cattle's (cows, goats etc) found dead & buried. Till date the walls of the plant and the roof remained covered with toxic materials which far exceeded safety standards. Survivors and their next generation continued to suffer from a number of ailments and cancers. Children were still being born with birth defects and there was an unusually high incidence of mental handicap and other ailments. issues: issues To analyze the world's worst industrial disaster, reasons & consequences. Stance taken by union carbide & state government. How multinational corporations can be held accountable for its malpractices in a country other than its origin. How Union carbide is full filling its corporate social responsibility & how far It is successful. Should require that corporations make information on hazardous materials or process public even if what would harm their buisness?what effect would such “right to know” law have Process : Process short comings of union carbide: short comings of union carbide The role played by union carbide is totally unethical & against the corporate social responsibility. System failures consequences Tank 610 contains 43 tones of MIC much more than the safety norms. High casualties due to excess amount of gas. Non working vent gas scrubber Due to failure of scrubber unable to detoxified the gas. Failure of flare tower Design to burn off gases but the connecting pipe removed for maintenance Failure of refrigeration system Freon system used to cool liquid MIC was shut down in June 1984 to save little amount of money. Underutilized tank 611 & 619 Due to which more quantity has been stored to tank 610. Chemical reaction: Chemical reaction The cloud contained a mixture of substances. Concentrations were higher close to the plant. The gases were heavier than air, displacing oxygen. Stance taken by ucil after disaster: Stance taken by ucil after disaster Emergency action plans were already taught to workers & supervisors but not implemented at all. Maintance manager didn’t report the bad health of safety equipments at all. Water has introduced directly into tank 610 as an act of sabotage by a disgruntled worker. Indian workers were showing resilience for training on emergency & other safety techniques. Stance taken by goi after disaster: Stance taken by goi after disaster UCIL tells MIC worker needed more training & there promotions were halted. workers are forced to use English manuals though only a few has grasp over language. Instrumental readings taken in two hours instead of 1 hour as recommended. Scarcity of skilled workers. UCIL-HO are not open to provide process knowledge to Indians. Issues with Indian operations:: Issues with Indian operations: Serious communication problems and management gaps between Union Carbide and its Indian operation . cross-cultural barriers. The personnel management policy led to an exodus of skilled personnel to better and safer jobs. Hands –off approach to its overseas operation. - no proper training to handle MIC Plant. -supervisory managers cut to half against recommended Nos. -no maintenance supervisor placed in night shift. -70 % employees were fined before the disaster for refusing to deviate from the standard safety regulations under pressure from management. Aftermath of the leakage: Aftermath of the leakage Medical staff were unprepared for the thousands of casualties. Doctors and hospitals were not informed of proper treatment methods for MIC gas inhalation. They were told to simply give cough medicine and eye drops to their patient. An Indian Government spokesman said that "Carbide is more interested in getting information from us than in helping our relief work. The gases immediately caused visible damage to the trees. Within a few days, all the leaves fell off. The Bhopal plant medical doctor did not have proper information about the properties of the gases CSR activities from UCIL: CSR activities from UCIL A settlement was reached under which UCC agreed to pay US$470 million (the insurance sum, plus interest) in a full and final settlement of its civil and criminal liability. 500-bed hospital for the medical care of the survivors. Bhopal Memorial Hospital and Research Centre (BMHRC) was inaugurated in 1998. Relief measures commenced in 1985 when food was distributed for a short period and ration cards were distributed. Widow pension of the rate of Rs 200/per month (later Rs 750) was provided. The final compensation (including interim relief) for personal injury was for the majority Rs 25,000 (US$ 830). For death claim, the average sum paid out was Rs 62,000 (US$ 2,058). The Bhopal Memorial Hospital and Research Centre (BMHRC) is a 350-bedded super specialty hospital. Heart surgery and hemodialysis are done. Major specialties missing are gynecology, obstetrics and pediatrics. Eight mini-units (outreach health centers) were started. Free health care for gas victims should be offered until 2006.  The management has faced problems with strikes, and the quality of the health care is disputed. In order to provide safe drinking water to the population around the UCC factory, there is a scheme for improvement of water supply CSR activities from goi: CSR activities from goi Effects of interim relief were more children sent to school, more money spent on treatment, more money spent on food, improvement of housing conditions. On June 24, the Union Cabinet of the Government of India approved a Rs 1265 cr aid package. 1986, the MP government invested in the Special Industrial Area Bhopal. 152 of the planned 200 work-sheds were built. In 2000, 16 were partially functioning. It is estimated that 50,000 persons need alternative jobs, and that less than 100 gas victims have found regular employment under the government's scheme. 2,486 flats in two- and four-story buildings were constructed in the "Widows colony" outside Bhopal. The water did not reach the upper floors. The Government of India has focused primarily on increasing the hospital-based services for gas victims. Several hospitals have been built after the disaster. In 1994, there were approximately 1.25 beds per 1,000, compared to the recommendation from the World bank of 1.0 beds per 1,000 in developing countries immediate response of union carbide: immediate response of union carbide On December 4, the day following the leak, Union Carbide sent material aid and several international medical experts to assist the medical facilities in Bhopal. The corporation established the Employees' Bhopal Relief Fund in February 1985, which raised more than $5 million for immediate relief. Developing the Responsible Care system with other members of the chemical industry as a response to the Bhopal crisis, which is designed "to help prevent such an event in the future by improving community awareness, emergency preparedness and process safety standards“. Union Carbide states on its website that it put $2 million into the Indian Prime Minister's immediate disaster relief fund on 11 December 1984.The corporation established the Employees' Bhopal Relief Fund in February 1985, which raised more than $5 million for immediate relief.