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Union Carbide Case Study

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Karishma Patel

Management 4500

Union Carbide Case Study

The tragedy that unfolded at the Union Carbide in Bhopal on December 3,1894 is one of the most remembered industrial accident recorded in the history. It is still unresolved due to a number of hasty and ill-informed judgments and it is indeed one of the most complex cases. Most of all, it not only deals with complex legal issues but also moral issues. Brining it down to responsibilities of Union Carbide U.S.A, it is somewhat partial. The accident was mainly occurred due to irresponsible employees that worked for Union Carbide India, which is a quasi-independent Indian firm. It is clear that Union Carbide India was the cause of a large number of deaths and injuries. However, Warren Anderson, the chairman of Board directors of Union Carbide, stated that they were "morally responsible". Being the Parent Corporation it was negligent with respect to the safety of people in the plant's environment and by not exercising control over the Indian plant that it should have exercised. The Corporation is liable for some damages being the parent company and therefore it would be their responsibility to pay some compensation to those affected. Moreover, It did own 50.9 percent of the plant in India and the basic design of the plant was conducted by American engineers who worked for Union Carbide, makes the Corporation responsible for the incident to a certain extent. They did face losses due to the bankruptcy of the company in India and on top of that they paid millions for the damages. In India, the 1973 Foreign Exchange Regulation Act specified that foreign companies in India are to share technology and use Indian resources; therefore local labor built the plant using Indian equipment's/materials. The MIC unit was based on a process design provided by Union Carbides engineers in the US and elaborated by engineers in India. The regulation also required that the plants to be run by Indian personnel therefore it limited Union Carbide (US) control over the Bhopal plant.

The number of victims that were severely affected were high in numbers and it would require a lot of care/money for their recovery. Thousands had died; millions were injured and lost their homes. The company did send some doctors with knowledge of MIC to Bhopal to treat the victims and gave 1 millions to the emergency refund. Since the Indian government hopped into legal issues right away and took the matter to the court, it lacked in compensating its victims adequately. If they worked with the corporation in the United States and its CEO, it probably would have saved more lives. Instead the first thing they did was arrested the CEO, managers and blamed it all on the American corporation. However, the legal actions taken by the Indian government had failed and it was left with $470



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