Minding Our Business Report (1997)

 

An Unending Nightmare: Union Carbide in Bhopal

For many people, the case of Union Carbide and follow-up to the Bhopal disaster is an example of the inadequacies of the global system and national governments to assure justice in the relations between TNCs and poor communities in developing countries. Almost every one of ToBI's seven recommended steps to ensure corporate accountability are justified by the reports on Union Carbide's behavior before, during, and after this incident which killed 4,000 people, injured 500,000 others,/5 and left as many as 50,000 still suffering for partial or total disability. Although Bhopal journalist Raj Kumar Keswani issued warnings as early as three years before the disaster - pointing to Union Carbide's failure to provide sufficient safety mechanisms while producing a deadly chemical -- the company continued along its fatal course, undaunted by the predicted consequences. Considering Union Carbide's history, which includes both the world's largest mercury spill at Oak Ridge, Tennessee in 1970 and the tragedy resulting in the death of 700 people at Hawk's Nest, West Virginia in 1930, one would think this company would have been more attentive to the possible consequences of its actions.

Bad Neighbor Practices

On December 2, 1984, the company leaked over forty tons of the poison gas methyl isocyanate into the sleeping Indian community. This day was the beginning of an "unending nightmare of injustice," as Gary Cohen, advisor to the Bhopal People's Health and Documentation Clinic put it. Among survivors, thousands suffered long-term damage to eyes, lungs, brain, liver, kidneys, and chromosomes. If clean production had been the required standard for US and Indian manufacturing operations, there would have been no Bhopal tragedy. First, the Preventive Approach would have assured that the plant had the proper safety mechanisms in place, regulating and evaluating the production process with a priority on avoiding rather than risking harm. Second, if effective pollution reduction targets and enforced regulations had been in place the plant would not have been producing dangerous pesticides. Jobs and tax revenues were among the benefits offered by Union Carbide's location of their chemical plant in Bhopal. However, the community might have viewed these benefits from a different perspective had they known the deadly consequences. One of the benefits of Right to Know laws and "good neighbor" practices is that companies are encouraged to operate in a framework valuing the community of which they are a part. Keswani's warnings should have prompted a flow of meaningful dialogues and negotiations between company and community leading not only to safe production processes but a safe product. The Bhopal tragedy should never have happened. However, when the incident did occur and residents were in need of proper medical attention, the Right to Know became an even more crucial issue. According to Jaising and Sathyamala, when people came into the hospitals with their symptoms, Union Carbide's management insisted that the gas they had been exposed to was non-poisonous, that recovery was almost certain, and that there would be no long-term effects. At the same time, the company refused to provide composition or toxicological information on the gases, on the nature of the injuries that could be caused from exposure, or the antidote or specific treatment which needed to be prescribed. Furthermore, when the Indian government began conducting medical research on the disaster this information was immediately made confidential under the Official Secrets Act. Public access to information was clearly not a priority, especially when this might be used in litigation. Such a situation made it easier for the medical debate to be superseded by political and financial priorities.

First Major Test

Sensitive to the possibility of wide-ranging liability claims, Union Carbide concentrated more on its defense than in doing the right thing. As Ward Moorehouse points out, "Had they been genuinely forthcoming and made truly disinterested offers of help on a scale appropriate to the magnitude of the disaster, they would almost certainly have been confronted with suits by shareholders seeking to hold the management accountable for mishandling company funds." It is said that Union Carbide's Chairman of the Board initially reacted to the news about Bhopal in a very human way, deeply upset at this wrong committed against so many people. However, within a week's time, and probably lots of legal advice about the company's financial liability, his attitude changed, focusing instead on efforts to limit compensation to the people killed and injured (including liquidating assets and paying shareholders to reduce the potential payout to victims.) In turn, the business community focused on him and how the national and international system of law would respond. Described as "the first major test of a U.S. corporation's liability for an industrial accident in a third-world country," the settlement dropped from the $3 billion sought by the Indian government to the $470 million finally agreed to by Union Carbide (after five years of no payment to victims while spending $50 million fighting the claim). Criticism of this settlement has, among other things, emphasized faulty methodology and assumptions about the number and extent of people injured. The average compensation settlement of $300 has barely met victims' basic medical costs, with no provision for development of other livelihoods or care for families.

Not only did Union Carbide legally escape the full scope of what would have been fair compensation to the victims, but the company has also successfully resisted extradition efforts by the Indian government, which filed criminal charges of "culpable homicide" against ten senior Carbide officials, including then-president Warren Anderson. Furthermore, the Indian Supreme Court recently reduced these criminal charges to "death by negligence" -- which in this particular case will eventually allow for dismissal (a ruling vigorously protested by various groups, including the Campaign for Justice in Bhopal). In the opinion of many NGOs, the Union Carbide/Bhopal case provides corporations with "real, tangible evidence that they cannot be brought to justice, no matter how great the crimes they commit." Union Carbide thus presents an example of a voluntary code of conduct quite far from Agenda 21's goal of ensuring responsible and ethical management of products and processes from the point of view of health, safety and environmental aspects. Companies which forego or make only minimal voluntary progress towards social responsibility place governments in a difficult position with their citizens. Governments resisting their responsibility to ensure corporate accountability and maintaining legal systems which fail to hold wrongdoers liable for unjust and destructive behavior risk losing legitimacy; when this occurs, civil society will inevitably seek to fill the vacuum. At one end of the spectrum are actions such as the Permanent People's Tribunal (PPT), which in 1996 completed five years of work on the Charter on Industrial Hazards and Human Rights, described as "an attempt to fill gaps in international law by coming up with a series of remedies for such violations" as Union Carbide's debacle in Bhopal (where the Tribunal held four hearings). The PPT, an international public opinion tribunal organized to identify and publicize "the systematic violation of fundamental rights, particularly in those cases where national and international law fail to protect people's rights," represents an orderly, peaceful attempt to address the failure of the legal system to secure justice. At the other end of the spectrum, for those people abandoned and discarded by the justice system, the only responses left besides hopelessness are nonviolent resistance or violent rebellion.

Next: Running on Empty: Shell in Nigeria (Case Study #2)