UNION CARBIDE BHOPAL

Jackson Chao

Andy Xu

Alan Wang

Binardy Tjuatja

Emily Lin

Lee Groff

UNION CARBIDE BHOPAL

• Stakeholders

• Change

• Ethical Issue

• Alternatives

• Recommendation

• Stakeholders

• Change

• Ethical Issue

• Alternatives

• Recommendation

UNION CARBIDE BHOPAL

Stakeholders Change Ethical Issue Alternatives Recommendation

The stakeholders:

• Union Carbide

• The victims of the gas attack (employees)

• The local government

• The members of community

• The CEO of the Union Carbide

• The Greenpeace Group

Before the Disaster :

• The Union Carbide: cut off costs, increase profits

• The victims of the gas attack: safe working conditions, equal pay

• The local government: ensure the safety of employees, prevent environmental damage

• The members of community: ensure the environment is clean

• The CEO of Union Carbide: to increase profits as much as possible

• The Greenpeace Group: to ensure the plant is not polluting the environment

Stakeholders Change Ethical Issue Alternatives Recommendation

After the Disaster :

• Union Carbide: to pay as little compensation as possible and escape all responsibility

• The victims of the gas attack: require fair compensation

• The local government: to ensure the victims get fair compensation and assign responsibilities for cleaning up the pollution caused by the plant

• The members of the community: help clean up the pollution

• The CEO of Union Carbide: escaping responsibility

• The Greenpeace Group: to make sure UCC cleans up the pollution

Stakeholders Change Ethical Issue Alternatives Recommendation

Economic Change• The recession of 1970-71 hammered commodities

companies like Union Carbide, with the chemicals and plastics markets entering another cycle of overcapacity.

Stakeholders Change Ethical Issue Alternatives Recommendation

Economic Change• From 1967 to 1973, production costs were cut by one-third to avoid the inefficiencies and

plummeting prices that had accompanied industry-wide overcapacity.

Economic Change

Stakeholders Change Ethical Issue Alternatives Recommendation

Economic Change

• Steadily rising expenses in Europe resulted in a $32 million loss in 1978.

• That same year, UCC was forced by its creditors to retire $292 million in long-term debt, which forced it to borrow $300 million in 1979.

5 Years later -- 1978 The company found itself increasingly strapped for cash.

Economic Change

Stakeholders Change Ethical Issue Alternatives Recommendation

Economic Change

• was proved to be a losing venture and ceased active production in the early 1980s

The Union Carbide factory in BhopalEconomic Change

Stakeholders Change Ethical Issue Alternatives Recommendation

Economic Change

• However, vast quantities of dangerous chemicals remained

• Three tanks continued to hold over 60 tons of methyl isocyanate(MIC)

• Cut-backs

The Union Carbide factory in Bhopal

Economic Change

Stakeholders Change Ethical Issue Alternatives Recommendation

• 1950: population 70,000

• 1956: Becomes State Capital

• 1984: population 695,000

ENVIRONMENT Change

Stakeholders Change Ethical Issue Alternatives Recommendation

Ethical Issues before the Disaster

Stakeholders Change Ethical Issue Alternatives Recommendation

Ethical Issues after the Disaster

Stakeholders Change Ethical Issue Alternatives Recommendation

Alternatives Before the Disaster

Alternative #1

• Try to increase the product sales

• Keep all production

Alternative #2

• Cease production and dispose all MIC chemical gas

• Safe for the local residents

• The cost of disposing the gas is large

Stakeholders Change Ethical Issue Alternatives Recommendation

Alternatives Before the Disaster

Alternative #3

• Cease production, keep MIC chemical, but continue to perform regular maintenance

• Does not cost too much

• Safe for local residents

Alternatives After the Disaster

Alternative #1

• Doing nothing

• The site continues to poison residents

• Injured people who can’t work and have no family left to take care of them can’t survive

Alternative #2

• Help the doctors treat gas-affected victims

Stakeholders Change Ethical Issue Alternatives Recommendation

Alternative #3

• Compensate the victims

• Increasing the compensation to help people survive

• Providing at least 20 years’ worth of medical expenses

Alternative #4

• Properly clean up the site and provide safe drinking water

• New generation will not be poisoned

Alternatives After the Disaster

Stakeholders Change Ethical Issue Alternatives Recommendation

RecommendationBefore the Disaster

Alternative 3 is recommended

Management should elect to cease active production on the plant but continue regular maintenance

Methyl Isocyanate or MIC is a highly reactive and deadly gas that remained in the tanks after production was cut off

Allowing the safety system to fall into disrepair leaves the door open for a potential disaster

Stakeholders Change Ethical Issue Alternatives Recommendation

Why?

• There is no market in India for Union Carbide’s pesticides

• Therefore, it follows that the plant should cease operations

• With the safety of Indian citizens at mind, regular maintenance should continue to prevent any disasters

Stakeholders Change Ethical Issue Alternatives Recommendation

RecommendationFollowing the Disaster

• A combination of alternative 3 and alternative 4

• Victims need to be better compensated

• They have endured much suffering and deserve better treatment than they have received to date

• Provide compensation for at least 20 years worth of medical expenses, as oppose to the 5 years originally offered.

• Key Component of new Compensation Settlement: consultation with the victims

• Victims should have a say in compensation levels as they were the ones who have suffered

Stakeholders Change Ethical Issue Alternatives Recommendation

Recommendation #2Following the Disaster

• Fully clean up the Union Carbide site

• Chemicals left behind by Union Carbide continue to cause environmental damage and poison a new generation

• Enough suffering has occurred in India and the upcoming generation should not be exposed to the deadly chemicals

• Also, it needs to be made certain that the soil and water near the plant are not contaminated with chemicals

Stakeholders Change Ethical Issue Alternatives Recommendation

Why do we make this recommendation?

• Utilitarian Theory

• Compensating the Bhopal victims with 20+ years worth of medical expenses is the best solution as it provides the greatest amount good for the greatest number of people

• Although an expensive alternative for Union Carbide, compensating victims to the greatest extent possible shows victims there is genuine concern for them

• Deontological Theory

• The action of providing better compensation for the victims is a morally responsible action

Stakeholders Change Ethical Issue Alternatives Recommendation

QUESTIONS?

THE END