MGX 5020

BUSINESS ETHICS IN A GLOBAL ENVIRONMENT

ETHICS OF THE NATURAL ENVIRONMENT:

THE IMPACTS OF COAL MINING IN GLOBAL

ENVIRONMENT

SUBMITTED BY:

ALDO BASUKI - 18850499

CONTENT

ABSTRACT..............................................................................................................................................1

INTRODUCTION.......................................................................................................................................2

COAL MINING IN AUSTRALIA…………………………………………………………………………..3

THE UTILITARIAN PERSPECTIVE OF COAL MINING INDUSTRY...............................................................4

THE ETHICS OF RIGHTS OF COAL MINING INDUSTRY............................................................................6

THE ETHICAL RELATIVISM OF COAL MINING INDUSTRY………………………………………………8

ENVIRONMENT IMPACTS FROM COAL MINING INDUSTRY……………………………………………..9

CONCLUSION........................................................................................................................................12

RECOMMENDATION..............................................................................................................................12

REFERENCES........................................................................................................................................13
ABSTRACT

This paper will look into the issues of the coal mining industry, how it affects the

environment, and what are the preventive measures that have been or should been taken.

Examples of damages caused by the mining emission to the environment will be provided

and discussed. Although mining has an impact on the physical landscape, global warming

and ecosystem, utilitarian ethics are applied to the case of mining. It briefly explores the

importance and benefits of the coal mining industry. But when you applied the ethics of

rights, it will explore the negative impacts of the coal mining industry and the need for

companies to achieve a balance between profitability and corporate responsibility. Lastly,

solutions are researched and discussed to solve the issues caused by the coal mining industry.

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INTRODUCTION

Mining is the excavation of precious minerals that come from within the earth, usually found

in ore bodies, veins, or coal seams. Mining can be conceded almost anywhere, from 4,000 m

above sea level to 4,000 below, from tropic jungles to the Arctic. Examples of minerals that

can be mined are coal, copper, silver, iron, gold, diamonds, etc. People mined everything that

cannot be grown or artificially made. Mining is very important because it gives access to

minerals and material that people uses in daily basis.

Coal is one of the most abundant fossil fuels in the world. it is combustible rock made from

the remains of plants from about 100 to 400 million years ago when deep forest covered for

most parts of the earth. Because it takes millions of years to produce coal, it is classified as a

non-renewable energy. Coal is predominantly used as a fuel to generate electricity. World

coal consumption in 2009 was about 5924 million tons. The top 5 coal producing countries

are China produced 2971 million tons in 2009, followed by U.S.A. with 919 million tons,

India with 447.3 million tons, Australia with 335 million tons and Indonesia with 263

millions tons. Coal is the major fuel used for generating electricity worldwide these days

because it is the cheapest. A lot of Countries are heavily dependent on coal for electricity, for

examples in year 2008: South Africa (93%), China (79%), Australia (77%), India (69%). In

2006, 41% of world’s electricity generated by coal. Unless we found a new alternative to

coal, the usage in electricity will increase. (Worldcoal, 2010)

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COAL MINING IN AUSTRALIA

Australia is one of the world’s major coal producer and exporter. Its land is rich in coal,

predominantly in New South Wales (NSW) and Queensland (QLD) regions. The industry is

not only extremely vital, but lucrative. Not only does coal generate about 85 per cent of the

nation’s electricity (ABARE, 2010), coal also contributes to Australia’s growing international

trade. A whooping 75 per cent of the country’s coals are exported globally (ABARE, 2010).

However, there are adverse effects on the natural environment that is attached with this

industry that has sparked many a debate in recent years (Bushfire Cooperative Research

Center, 2006). The process of burning coal releases greenhouse gases (mostly carbon dioxide

CO2), which contributes to global warming and climate change.

Releasing of greenhouse gases from the coal industry increases CO2 levels in the atmosphere,

leading to absorption and emission of thermal infrared which result in higher temperature (i.e.

global warming). This higher temperature leads to destruction of natural environment such as

bushfires (especially in VIC regions during summer) and also coral bleaching of the Great

Barrier Reef (Bushfire Cooperative Research Center, 2006). This leads to serious blow to

Australia’s ecosystem as habitat, marine life and vegetations (both land and sea) as they

gradually decimate. The loss of species through deforestation from the bushfires and coral

damage is would be costly as Australia is home to some of the world’s most endangered

species (e.g. tree-kangaroo and dugong). The eradication of these vegetations will also further

worsen the issue of CO2 emission as these vegetations have an important part in the

environment by absorbing CO2 and converting them into oxygen (O2).

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THE UTILITARIAN PERSPECTIVE OF COAL MINING INDUSTRY

Utilitarian theory was first formulated in the eighteenth century by Jeremy Bentham and later

refined by John Stuart Mill. Utilitarian look beyond self-interest to consider impartially the

interests of all persons affected by an action. The theory emphasizes consequences of an

action on the stakeholders. The stakeholders are those parties affected by the outcome of an

action. Utilitarian recognize that trade-offs exist in decision-making. Utilitarian theory is

concerned with making decisions that maximize net benefits and minimize overall harms for

all stakeholders. It is similar to cost-benefit analysis decision-making. The ultimate rule to

follow is the “Greatest Good for the Greatest Number.” (Stanford, 2009)

Coal is Australia’s largest commodity export that earns an estimated $55 billion in 2009.

From a utilitarian perspective, such revenue would best benefit the stakeholders, Australian

mining companies, Australian public, government and most importantly the mining jobs. It

has been reported by the International Energy Agency that the world’s demand for energy

would increase by 40 per cent by 2030 (ABARE, 2010). As the world’s leading coal exporter,

an increase in energy demand represents a potentially large amount of income for Australian

coal mining industry. Needless to say, energy services are undeniable part of humans’ basic

needs. Energy is undeniably vital for the most basic of needs, such as “cooked food, a

comfortable living temperature, lighting and the use of appliance”. Moreover, energy is

indispensable in the daily running of other industries such as agriculture and manufacturing.

Coal provides a reliable and affordable source of energy to homes, businesses and production

industries. Without which, business are not able to go about their daily running (Knights and

Hood, 2009).

In a greater context, coal has been vital to Australia’s economic growth and has a significant

correlation to Australia’s GDP (Knights and Hood, 2009). Demand is most strong in

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developing countries and this is estimated to rise over time. In addition, the employment of

employees leads to an overall greater productivity in Australia. Economically speaking,

salaries paid to employees are consequently spent in the economy, which increases the

demand for goods and services resulting in the creation of even more jobs (Knights and

Hood, 2008). Without the coal industry, a good percentage of employees may lose their jobs.

It is reported that the coal industry employs more than 300,000 people a year (ABS, 2009). In

addition, Knights and Hood argues that the coal industry causes a flow-on effect to non-coal

sectors estimating that the coal industry indirectly employs 126,540 (2009).

Corporate social responsibility has become an important issue nowadays in the corporate

world. However, corporations tend to pay more attention in term of social responsibilities to

developed countries than developing countries (Kapelus, 2002). Indigenous groups have

always been opposed to the idea of mining for energy in Australia (Kapelus, 2002). This is

due to a wide range of issues such as profit-flows, representation on the company board and

compensation measures (Kapelus, 2002). Often, the company is willing to pay the indigenous

group a price in order to gain the right to mine, regardless of the damage caused to the

environment. In order to satisfy the interest of the whole indigenous community, the

indigenous group ignore the environmental issues related for monetary benefit.

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THE ETHICS OF RIGHTS OF COAL MINING INDUSTRY

As suggested by John Locke, human beings are entitled to their natural rights and therefore,

should be respected by others. These rights are identified as “Life, Liberty and Estate

(property)” (Locke, 1824). According to Locke the meanings of these three rights are:

 Life: everyone is entitled to live once they are created.

 Liberty: everyone is entitled to do anything they want to so long as it doesn't conflict

with the first right.

 Estate: everyone is entitled to own all they create or gain through gift or trade so long

as it doesn't conflict with the first two rights.

Following this notion, Locke’s thoughts on the attainment of knowledge can be summed up

in his quote, “The improvement of understanding is for two ends: first, our own increase of

knowledge; secondly, to enable us to deliver that knowledge to others”. (Locke, 1824)

The importance of this concept can be directly related to the ethical behaviour of Coal mining

companies regarding the mining effects on the environment. Coal mining produces a few

unique major environmental effects such as the release of methane gasses that cause

greenhouse effect, the effects on water and the dust produced from the mining itself. All of

these massive amounts of emissions are extremely harmful to the environment because coal

mining is a huge industry all to itself. The methane gasses that released by coal mining are

the leading cause of global warming and climate change. The most common way to mine coal

is through strip mining, which severely alters the landscape because it removes a large

portion of land to revel the minerals underneath. Which create a permanent damage to the life

ecosystem of the coal mining site. (Worldcoal, 2010)

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Even before the coal consumed, the mining itself already took a great deal of negative

impacts to the global environment. Global warming and climate change will affect the life of

millions of people around this world and it directly violates the ethics of rights. One should

have the right to live, liberty and prosper, if the coal mining endangered environmental as a

whole that means it violates with basic human rights to live. Living in polluted and damaged

environment could seriously harm someone’s life because it’s not an healthy life.

Coal mining is also a dangerous mining, China produce one third of the world’s total but it

has the worst rate of fatal coal mining accident (4/5 of the world’s accidents). The fatality

rate is 14 deaths per million tons of coal mined in year 2000, which is much higher than any

coal mining countries. There are 4547 miners killed in 2378 coal mine accidents in year 2001

alone. The reason why mining safety is poor in China because there are a lot of small coal

mining companies that want to achieve high profit by reducing their cost of operation (lack of

skilled workers, inspectors, even government supervision), which cost the life of its workers.

(Wanjun, 2000)

The coal also further harmed the environment when it is burned as a fuel and creates toxic

fumes. Majority of heavy industries uses coal as their main fuel source because it is still the

cheapest source of energy today. Coal creates massive damage to the environment by how it

got mined and when it consumed. Effects of the coal use such as global warming and climate

change have already been felt and should be take in serious matter. Global climate change

could be harmful to the agriculture industry globally. Unpredictable weathers are harmful

people in agriculture business and the effects could be snowballed to the rest of the other

industries. Climate change could also lead to unpredictable natural disaster such as

hurricanes, volcanoes eruption and Tsunamis. If people wait for all these negative impacts to

happen, it will be already to late and takes time for the environment to heal itself. The society

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should start reducing the uses of coal because in the big picture it endangered the society

itself. There are a lot of other alternatives source of energy could be uses instead of coal.

THE ETHICAL RELATIVISM OF COAL MINING INDUSTRY

Coal mining has been largely criticised as one of the main source of climate change but this

does not stop developing countries such as China to invest heavily in this area. In fact, China

officially has the largest mining industries in the world today (Wanjun, 2000). This can be

illustrated from an ethical relativism perspective. As long as mining is able to benefit China,

other issues such as pollution, deforestation and climate change are of little concern.

Frequently, the main objective of the mining owners is to maximise profits and with little

regards of whether such activity is ethical and positive to environment (Gregory, 2010).

Mining industry in China is able to provide millions of jobs and generate substantial income

for the country. Moreover, coal producing is predicted to be able to provide more than half of

China needs (Buy USA 2006). Different cultures have different standards of ethics and often

the desire for wealth come at the expense of sacrificing one’s moral value.

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ENVIRONMENT IMPACTS FROM COAL MINING INDUSTRY:
Source: (Worldcoal, 2010), (Union of concerned scientist, 2009), (Sourcewatch, 2010)

* Acid mine drainage (AMD) - the outflow of acidic water from coal mines, often

abandoned mines where coal mining activities have exposed rocks containing the sulphur-

bearing mineral pyrite. The mineral Pyrite reacts with air and water and form sulphuric acid

and dissolved iron, so as water washes through mines, this compound forms a dilute acid,

which could wash into nearby rivers and streams.

* Air pollution from coal-fired power plants - it includes sulfur dioxide, nitrogen oxides,

particulate matter, and heavy metals, leads to smog, acid rain, toxins in the environment, and

numerous respiratory, cardiovascular, and cerebrovascular effects.

* Air pollution from coal mines - emissions of particulate matter and gases including

methane (CH4), sulfur dioxide (SO2), and nitrogen oxides (NOx), as well as carbon

monoxide (CO).

* Climate impacts of coal plants - Coal-fired power plants are accountable for 1/3 of

America’s carbon dioxide (CO2) emissions, making it a huge contributor to global warming.

* Coal combustion waste - the nation's second largest waste stream after public solid

waste. It disposed of in landfills, which are lined with compacted clay soil, a plastic sheet, or

both. When rain filters through the toxic ash pits year after year, the toxic metals are leached

out into the local environment.

* Coal sludge, - Washing coal generated the liquid coalthe liquid coal waste generated by

washing coal. It is typically disposed of at impoundments located near coal mines, because

coal sludge contains toxins, leaks or spills can endanger underground and surface waters.

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 * Floods - such as the Buffalo Creek Flood caused by mountaintop removal mining and

failures of coal mine impoundments.

* Forest destruction caused by mountaintop removal mining - mountaintop removal mining

has destroyed 6.8% of Appalachia's forests.

* Greenhouse gas emissions caused by surface mining - mountaintop removal mining

releases large amounts of carbon through clear cutting and burning of trees and through

releases of carbon in soil brought to the surface by mining operations.

* Loss or degradation of groundwater - coal seams are often serve as underground

aquifers, removal of coal beds may result in drastic changes in hydrology after mining has

been completed.

* Heavy metals and coal - Coal contains many heavy metals. Most the heavy metals

released in the mining and burning of coal are environmentally and biologically toxic

elements, such as lead, mercury, nickel, tin, cadmium, antimony, and arsenic, as well as radio

isotopes of thorium and strontium.

* Mercury and coal - Emissions released from coal-fired power plants are the largest

source of mercury in the United States, accounting for about 41 percent (48 tons in 1999) of

industrial releases.

* Methane released by coal mining accounts for about 10 percent of US releases of

methane (CH4), a potent global warming gas.

* Mountaintop removal mining and other forms of surface mining can lead to the drastic

alteration of landscapes, destruction of habitat, damages to water supplies, and air pollution.

Not all of these effects can be adequately addressed through coal mine reclamation.

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 * Particulates and coal - Particulate matter includes the tiny particles of fly ash and dust

that are expelled from coal-burning power plants.

* Radioactivity - Coal contains minor amounts of the radioactive elements, uranium and

thorium.

* Sulphur dioxide and coal - Coal-fired power plants are the largest human-caused source

of sulphur dioxide, a pollutant gas that contributes to the production of acid rain and causes

significant health problems. Coalcontains sulphur, and when coal is burned, the sulphur

combines with oxygen to form sulphur oxides.

* Thermal pollution from coal plants - when water used as a coolant is returned to the

natural environment at a higher temperature, it impacts organisms by decreasing oxygen

supply, and affecting ecosystem composition.

* Transportation - Coal transported via trucks, railroads, and large cargo ships, which

release air pollution such as soot and can lead to disasters that ruin the environment, such as

the Shen Neng 1 coal carrier collision with the Great Barrier Reef, Australia that occurred in

April 2010.

* Waste coal - made up of unused coal mixed with soil and rock from previous mining

operations. Surplus from waste coal sites can pollute local water supplies.

* Water consumption from coal plants - Power generation has been estimated to be second

only to agriculture in being the largest domestic user of water.

* Water pollution – Water from coal mines includes the negative health and environmental

effects from the mining, processing, burning, and waste storage of coal.

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CONCLUSION

Overall, mining will always have opportunity costs to the natural environment. In Australia

alone, mining contributes to more than 40 per cent of the greenhouse gases and other

destructions to natural environment (bushfires and coral reefs). However, mining object such

as coal is an affordable, vital and abundant source of energy. Therefore, it is important for

firms to balance profitability and their corporate social responsibility (CSR). Ethics will no

longer be a debatable issue only when everyone can reach middle ground where they can

sustain this sector.

RECOMMENDATION

Companies are now adopting an outlook of ethics of care and implement CSR initiatives.

Clean coal technology has been introduced to reduce the carbon emission. For example Clean

Technology Australasia has been promoting this technology to companies around Australia

(Clean Technology Australasia, 2007). This is a step in preserving the environment.

Governments too are taking an active role. In the recent election, parties have debated on

applying carbon tax. This would be an effective incentive for companies to reduce their

carbon footprint in the benefit of the natural environment. Alternative energy has also been

evolving. At present, renewable energy include hydro, wind and solar. However, the

production of energy from renewable resources is comparatively low. While it is insufficient,

renewable energy is a step towards lowering carbon emissions.

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