[MGT503 Business Ethics] [4th Semester]

Bhopal- A Case Study of International Disaster

BY BINOD RAYAMAJHI

IIMS COLLEGE, MBA 4TH SEM

STUDENT NO. 182383

1
[MGT503 Business Ethics] [4th Semester]

Introduction

The Bhopal disaster, also referred to as the Bhopal gas tragedy, was a gas leak
incident in December 1984, considered as the world's worst industrial disaster ever
known to mankind. When India attained independence from Great Britain in 1947, its
new political leaders wanted to make the country wealthier by encouraging
development of modern industry. It had strong support from the citizens, who
generally agreed that India’s current lack of industrialization and economic
development were the result of these colonial-era policies. Thus, the new political
elite expected widespread support for any policy that appeared to set the country on
the path to industrialization.

Bhopal was one of the fastest-growing cities in India during the 1960s and 1970s as
unemployed people from the surrounding countryside came looking for better
opportunities and the state government was anxious to have an industrial base.
Central government and the state government of Madhya Pradesh, of which Bhopal is
the capital, were anxious to bring industry to the area. Union Carbide India Limited
(UCIL) a subsidiary of US-based Union Carbide Corporation plans for establishment
of chemical plant had met with a favorable reception by the state government having
99 years long lease agreement in Bhopal.

During the night of 2-3 December 1984, a leak of some 40 tons of methyl isocyanate
(MIC) gas mixed with unknown other gasses from a chemical plant owned and
operated by UCIL caused one of the highest-casualty industrial accidents of the 20th
century. At least 2000 people died immediately and another 200,000 to 300,000
suffered respiratory and other injuries of varying severity. Property damage consisted
mainly of contamination to nearby areas by various chemical residues.

2
[MGT503 Business Ethics] [4th Semester]

Major Issues

Major issues observed in Bhopal gas tragedy are:

The UCIL had met with a favorable reception by the state government to establish
their plant having long lease agreement in Bhopal nearby residential area without
proper assessment and examination regarding environment and social aspects.

This whole disaster started from the lack of risk assessment as well. They have placed
the factory without evaluating the compatibility of the location to survive any terrible
accident that could happen resulting from human errors or machines faulty.

Responsibility for safety should have to be the most important aspect and highest
ethical priority of any industry, however in this case the same is not found to be
complied and totally neglected.

Early warning signals could be sensed before the gas leak incident. Trade unions in
Bhopal complained of pollution within the plant. A worker accidentally inhaled a
large amount of toxic phosgene gas, leading to his death. Journalist began
investigating and publishing about the factory’s demerits and the city under threat.

On December 3, 1984, MIC, the toxic gas, started leaking from a pesticide plant and
within hours, deadly MIC clouds surrounded the city where thousands of people died
immediately and large population suffered respiratory and other injuries of varying
severity over there. Various health issues were sensed during long years after the
incident.

Conflict of interest, lack of proper risk assessment, lack of safety precautions,

management responsibility as well as government apathy has also observed.

3
[MGT503 Business Ethics] [4th Semester]

Ethical and moral concern and challenges

No proper assessment and examination regarding environment and social aspects are
conducted by the concerned while establishment of the chemical plant nearby the
residential area. Extreme lack of precautionary measures within the gas storage area
as well as deficit code of conduct among its employee is observed. Conflict of interest
had played a major role to occur this deadly disaster in UCIL, Bhopal.

It was a result of poor hazard management, poor safety management practice,

unaware of early warning signals, poor perception of the risk involved as well as lack
of safe and healthy working environment within the workplace. Communication error
and technical as well as operational errors are other major influential factors of the
disaster.

Bhopal accident shows that, many stakeholders like government (regulatory) failure,
technical and operator failure, corporate (management) failure are the most critical
ones that need attention if accidents are to be avoided.

A conflict of interest occurs when an individual or organization is involved in

multiple interests, one of which could possibly corrupt the motivation or morality for
an act in another. This is present in the Bhopal disaster when the UCIL had the aspect
of severe minimization of costs to obtain higher profits as its main motive and
priority. This indirectly lowered the quality of man power, specialization, skill level
and morality of workers of the plant of which has its contributions to the disaster so
far.

Responsibility for safety is the most important aspect and highest ethical priority of
any industry. Engineers must avoid calamitous failure which could result in loss of
property, damage to the environment and possibly injury or loss of life. The safety,

4
[MGT503 Business Ethics] [4th Semester]

health and welfare of the employees, employers and even the public are of utmost
important. There should also be a proper emergency response plan.

Application of ethical theories

Accidents don’t just happen, but often result from poor job practices and
environments that fail to prioritize safety. Moral standards about behavior or
practices with serious or immediate effects for human well-being should have to be
followed.

The company often derives a profit from a product without considering the overall
social cost it damages to the environment and human populations as well. A conflict
of interest occurs when an individual or organization is involved in multiple interests,
one of which could possibly corrupt the motivation or morality for an act in another.
This could be sensed in the Bhopal disaster when the UCIL had the aspect of severe
minimization of costs to obtain higher profit as its main motive and priority. This
indirectly lowered the quality of man power, specialization, skill level and morality of
workers of the plant of which has its contributions to the disaster. When the main
objective for the setting up of a factory or high-risk establishment like this chemical
factory is mainly for money purpose, the management or top personnel in this
establishment as considered to be neglected other important factors in setting up the
factory such as environmental ethics, safety responsibilities, professional
responsibilities, legal obligations and the concern for humanities and this gives rise to
the conflict of interest within organization.

Professional codes shall be always considered that govern the conduct of the
employees of a given profession. Individuals have the responsibility to critically
assess the rules of their professions to avoid unwanted risk. In this disaster, while
periodic washing operations proceeded at around 9.30 pm, water did not back up into

5
[MGT503 Business Ethics] [4th Semester]

storage tanks and bleeder valves at the bottom of the discharge pipes were blocked
and the worker doing the washing noticed this and stopped washing to report the
problem, however his immediate superior, an operations supervisor rather than a
maintenance supervisor told him to continue. This was not detected, and washing
continued till after the third shift which comes on at around 10.45pm. This reporting
channel or code of conduct has not seems to be proper as it has to be resulting such
deadly disaster. In relation with this, it was highly unethical for the worker’s
immediate supervisor to instruct the worker to continue despite knowing the
malfunctions discovered. It was also unethical for the worker to report to the wrong
superior.

Corporations often pressured to compromise moral values and ignore or violate rules
of ethical conduct to attaining their goals neglecting other essential factors. The
effects of environmental recklessness by manufacturing, industry, and consumers are
often seen. Humankind scarred the globe, polluted the air, contaminated the soil and
used up the resources. There are various responsibilities of businesses regarding the
environment, plants and animals, and all other resources. In this disaster, thousand of
peoples was dead and around 300K peoples have suffered from acute syndromes
mainly in their respiratory systems, burning sensation in eyes which led to blindness,
suffocation as their lungs are filled with fluids etc. though they did not died on instant
and this effect is far more painful than instant death. Hundreds of animal were died
and trees, plants in the nearby area became deserted and land has contaminated.

Contingency solutions (for the time being)

While natural disasters are largely unpredictable, environmental disasters are caused
directly or indirectly by human behavior. Chemical disasters, like the one in Bhopal,
are preventable if risks are identified and addressed early on.

6
[MGT503 Business Ethics] [4th Semester]

Warning bell before the tragedy could be believed there, since a few years before the
disaster, a worker accidentally inhaled a large amount of toxic phosgene gas, leading
to his death a couple of hours later. Observing the events, a journalist began
investigating the plant and also published his findings in Bhopal's local paper, saying
'Wake up people of Bhopal, you are on the edge of a volcano'. Two years before
tragedy struck Bhopal, around 45 workers who were exposed to phosgene were
admitted to a hospital as well.

At the time being, it should be taken combined effort of competent authorities,

immediate management and society to prevent tragic environmental events from
happening. Some measures include developing policies to ensure that industries
operate in accordance with technical and safety standards and allocating resources for
risk assessment and monitoring taking environmental safety and public health risks
seriously can make a big difference. If professional code of conduct, conflict of
interest, moral standards and ethics, proper communication, integrity and
responsibility were obeyed at that time, must probably the incident was evaded.

Lesson learnt

The accident at Bhopal is the worst industrial disaster in history. UCC and UCIL
were clearly responsible for the accident. There is no excuse for such negligence on
the part of a company that has been in the chemical industry for almost 100 years. It
is accepted management theory and practice. The government inspectors who gave
clearance certificates to the Bhopal plant also bear part of the responsibility for the
accident. The large number of deaths and injuries is to be recognized to the lack of
information and absence of a disaster management plan of all concerned parties.

The Bhopal disaster had created an undeniably massive impact on the world’s view in
these matters. Ever since the incident occurred, the citizens all over the world

7
[MGT503 Business Ethics] [4th Semester]

especially in developed nations like America, Europe, Japan and Australia have been
more aware of the safety precautions practiced in the factories that manufacture
chemical or hazardous substances.

Expanding industrialization in developing countries like Nepal without concurrent

evolution in safety regulations could have catastrophic consequences. Important
lessons learnt from Bhopal incident and should be applied in Nepalese organizations
to be professional code of conduct, good ethics and behavior, responsibility for safety
measures, proper communication channel, social and environment due diligence and
risk assessment are the most important aspects that should be practiced in every
establishment. Non-existent of these subjects will lead to a terrible damage to the
factory, economy, environment and the civilization.