1. Jackson Chao Andy Xu Alan Wang Binardy Tjuatja Emily Lin Lee Groff UNION CARBIDE BHOPAL

7. Stakeholders Change Ethical Issue Alternatives Recommendation Stakeholders Change Ethical Issue Alternatives Recommendation UNION CARBIDE BHOPAL

8. Stakeholders Change Ethical IssueAlternativesRecommendation 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

9. 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 IssueAlternativesRecommendation

10. 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 IssueAlternativesRecommendation

11. 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 IssueAlternativesRecommendation

12. 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 IssueAlternativesRecommendation

13. 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 IssueAlternativesRecommendation

14. ECONOMIC CHANGE was proved to be a losing venture and ceased active production in the early 1980s The Union Carbide factory in Bhopal ECONOMIC CHANGE Stakeholders Change Ethical IssueAlternativesRecommendation

15. 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 IssueAlternativesRecommendation

17. 1950: population 70,000 1956: Becomes State Capital 1984: population 695,000 ENVIRONMENT CHANGE Stakeholders Change Ethical IssueAlternativesRecommendation

18. ETHICAL ISSUES BEFORE THE DISASTER The MIC tank alarms had not worked for 4 years The flare tower and vent gas scrubber had been out of service for 5 months To reduce energy costs, the refrigeration system was idle Poor Maintenance Stakeholders Change Ethical IssueAlternativesRecommendation January 1982: phosgene leak, 24 workers were exposed => protective mask February 1982: MIC leak affected 18 workers 1983 & 1984: Regular leaks of MIC, chlorine, and monomethylamine Improper Safety Management Workers were forced to use English manuals, even though only a few understands the languange 70% of the plant’s employees were fined for refusing to deviate from the proper safety regulation (replacing leaked pipes) Repressive style Management

19. ETHICAL ISSUES AFTER THE DISASTER Short-term: Burning in respiratory tract and eyes, breathlessness, choking => death Long-term: Estimated between 100 – 200 thousands sustain permanent injuries (eye problems, respiratory difficulties, immune system disorders Health Effects Stakeholders Change Ethical IssueAlternativesRecommendation 2,000 bloated animal carcasses were disposed UCC’s laboratory test in 1989: soil and water samples collected from near the factory were toxic to fish Polluting compounds include naphthol, naphthalene and Sevin Environmental Damages Chemicals abandoned at the plant continue to leak and pollute the groundwater 2002: Inquiry found toxins including mercury, lead, and trichlorobenzene in nursing women’s breast milk Ongoing Contamination As of 2008: UCC had not released information about the possible composition of the cloud gas Several internal studies which exhibited severe contamination were not made public Withholding of Information

20. 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 IssueAlternativesRecommendation

21. 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

22. 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 IssueAlternativesRecommendation

23. 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 IssueAlternativesRecommendation

24. RECOMMENDATION BEFORE 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 IssueAlternativesRecommendation

25. 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 IssueAlternativesRecommendation

26. RECOMMENDATION FOLLOWING 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 IssueAlternativesRecommendation

27. RECOMMENDATION #2 FOLLOWING 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 IssueAlternativesRecommendation

28. 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 IssueAlternativesRecommendation

29. QUESTIONS? THE END