Description
This is documentation is describing about the case study of coca cola.
COCA-COLA: “Undrinkable, Unthinkable”
MANAGERIAL ETHICS CASE STUDY
Maariyammal is distressed. The well near her house, in Vijayanagar Colony, Palakkad, Kerala, is dark brown and smells sickeningly of a mixture of toddy and kerosene. Most of the wells in the neighborhood are in the same state. Maariyammal and many others living in the vicinity of Hindustan Coca-Cola Beverages Pvt Ltd (HCCB) are facing intense problems related to ground water. The ground water levels in the city and surrounding areas have dropped ranging from 22cm to 137 cm from March 2002 to M2003. Villagers have to travel up to five kilometers to access potable drinking water. To make things worse, When John Waite, programme presenter at BBC's Radio 4 heard of the villagers' complaints he visited the Coca-Cola plant to see for himself what was going on. In a programme, aired in August 2003, called Face the Facts, he showed how sludge from the factory contained "dangerous levels of the known carcinogen (cancer-causing) cadmium" and lead. Intake of cadmium can cause kidney failure, while exposure even to low levels of lead (especially among children) can result in mental retardation and severe anaemia. (The sludge samples were tested at the University of Exeter in the United Kingdom.) The sludge, a waste product of the plant's production process, was being given away to farmers to be used as fertiliser in their fields. At first the farmers were quite pleased to receive the sludge as it cut down on the amount of money they spent on buying fertiliser. That's until they realised just how dangerous the sludge was.
BACKGROUND
Hindustan Coca-Cola Beverages Pvt. Ltd established a bottling plant on 3rd June 2000 in a 40-acre plot (previously multi-cropped paddy lands) at Plachimada of Perumatty Panchayat in Chittur Taluk of Palakkad District, Kerala about 5 kms west of the Tamil Nadu border of Pollachi in Coimbatore District. The bottling plant was set up at a cost of $25 million and employed around 70 permanent workers and 150- 250 casual laborers. By 2002 the total number of people employed by Coca-cola in the Palakkad plant was around 500. Cola-Cola claims to be committed to ‘protecting and preserving the environment’. However, in India Coca-Cola has been accused of creating severe water shortages, polluting the soil and groundwater, distributing toxic waste as fertilizer to farmers and selling sub-standard drinks in the Indian market which contain high levels of pesticides, sometimes higher than 30 times those allowed by European Union standards. Thousands have been protesting against Coca-Cola throughout India.
Communities across India living around Coca-Cola's bottling plants are experiencing severe water shortages, directly as a result of Coca-Cola's massive extraction of water from the common groundwater resource. The wells have run dry and the hand water pumps do not work anymore. The significant depletion of the water table has documented by, for example, the Central Ground Water Board in India. This plant used to roll out 85 truckloads of soft drinks every day. The company was drawing 10 lakh liters of ground water every day. That was until people began agitating against the company for using up too much groundwater, leaving little for them to use for agriculture, even for their basic household needs. Locals also claimed the water was becoming polluted. Villagers, politicians, environmentalists and scientists all accused Coca-Cola of robbing the local community of their most precious resource – water, and of damaging their health and livelihoods. With time the wells in the area had started drying up and within a few months of the opening of the plant, the quality of water had deteriorated. Also Coca-Cola was accused of distributing sludge from the factory as a fertilizer. Open protests started against coca cola to shut their plant.
THE DISPUTE
“Drinking Coke is like drinking farmer’s blood in India,” said a protest organizer Nandlal Master. “CocaCola is creating thirst in India, and is directly responsible for the loss of livelihood and even hunger for thousands of people across India,” added Master, who represents the India Resource Center in the campaign against Coca-Cola. Indeed, one report, in the daily newspaper Mathrubhumi, described local women having to travel five kilometers (three miles) to obtain drinkable water, during which time soft drinks would come out of the Coca-Cola plant by the truckload. Senior scientist at the Exeter lab, David Santillo, has said: "What is particularly disturbing is that the contamination has spread to the water supply -- with levels of lead in a nearby well significantly above those set by the World Health Organization." Coke officials have always argued that their Plachimada plant conforms to the highest environment management standards. "The plant at Palakkad is certified to ISO 14001 and is open to inspection by all regulatory and accredited monitoring agencies. Allegations that The Coca-Cola Company is exploiting groundwater in India are without any scientific basis and are also not supported either by the
Government authorities who regulate our water use in India, academics, or the local communities in which our plants are located," said an official company spokesperson. The claims of locals were justified when scientific tests proved the same. On April 9, 2003 the Opposition Left Democratic Front-ruled Perumatty grama panchayat (the only panchayat in the State ruled by the Janata Dal, one of the constituents of the LDF) decided to cancel the license of the Coca-Cola Company’s bottling unit. The plant had to shut down. Over a month later, on May 16, the Communist Party of India (Marxist)-led administration of Pudusseri panchayat too announced a similar decision regarding the Pepsi unit situated in WISE Park, within the Kanjikode Industrial Development Area. Coca-Cola promptly approached the Kerala High Court and obtained a stay order against the panchayat's decision. On March 30, 2005 The Minister for Water Resources, Thiruvanchoor Radhakrishnan,
confirmed that there had been depletion of the groundwater table in the area surrounding the Hindustan Coca-Cola's bottling plant at Plachimada in Palakkad district. Replying to a submission by the CPI (M) MLA, V. Chenthamarakshan, in the State Assembly, Mr. Radhakrishnan said the Groundwater Department had subjected 16 wells around the Coca-Cola plant to a study from March 2002 to August 2003 to verify the complaint that the groundwater table in the area was going down due to the functioning of the plant. When the data gathered in March 2002 and March 2003 were compared, it was found that the water level had gone down by extents ranging from 22 cm to 137 cm in nine wells during this period. One well went even dry during the one-year period. In six wells, the water level increased by extents ranging between 21 cm and 110 cm. In July 2003, two more wells went dry. Inspite of the fact that the factory was causing real harm to the ecosystem, the company appealed to Supreme Court against the cancelling of the license. They managed to get clean chit from the government authorities on the plant being up to the environmental standards.
THE MATTER CONTINUES…..
Coca cola had already invested crores of rupees in the project. Also it was Kerala government’s initiative that led to coca cola opening a plant in Palakkad. Shutting the plant would lead to huge losses for the plant. Coca cola had some 13 plants in the country at that time however Palakkad plant was one of the biggest. The factory employed more than 500 people. The employment of these people was under question if the plant had to be closed. The amount invested in the project was huge. Also it had become a matter of prestige and reputation for the company.
DISCUSSION QUESTIONS
1. Should Coca cola continue to operate its bottling plant in Pallakad?
2. Is it ethical for HCCB to appeal in Supreme Court against the case after all the damage it has done? 3. Was HCCB right in distributing sludge as fertilizers to farmers?
4. Is it right for the Government and local authorities to cancel the license once given by them without proper evaluation of the consequences? What else could have been done to benefit both the local population and the company?
REFERENCES:
http://environment.about.com/od/waterpollution/a/groundwater_ind.htm http://www.cokefacts.com/India/facts_in_keyfacts.shtml http://www.financialexpress.com/news/hc-orders-rehearing-of-kerala-cocacola-bottling-plantcase/129400/ http://www.thehindu.com/fline/fl2012/stories/20030620002204600.htm http://www.ethicalcorp.com/content.asp?ContentID=1500 http://current.com/items/89381953_coca-cola-corruption-water-depletion-pollution-murder.htm http://www.dollarsandsense.org/blog/2007/07/challenging-cokes-thirst-for-water.html
doc_180934426.docx
This is documentation is describing about the case study of coca cola.
COCA-COLA: “Undrinkable, Unthinkable”
MANAGERIAL ETHICS CASE STUDY
Maariyammal is distressed. The well near her house, in Vijayanagar Colony, Palakkad, Kerala, is dark brown and smells sickeningly of a mixture of toddy and kerosene. Most of the wells in the neighborhood are in the same state. Maariyammal and many others living in the vicinity of Hindustan Coca-Cola Beverages Pvt Ltd (HCCB) are facing intense problems related to ground water. The ground water levels in the city and surrounding areas have dropped ranging from 22cm to 137 cm from March 2002 to M2003. Villagers have to travel up to five kilometers to access potable drinking water. To make things worse, When John Waite, programme presenter at BBC's Radio 4 heard of the villagers' complaints he visited the Coca-Cola plant to see for himself what was going on. In a programme, aired in August 2003, called Face the Facts, he showed how sludge from the factory contained "dangerous levels of the known carcinogen (cancer-causing) cadmium" and lead. Intake of cadmium can cause kidney failure, while exposure even to low levels of lead (especially among children) can result in mental retardation and severe anaemia. (The sludge samples were tested at the University of Exeter in the United Kingdom.) The sludge, a waste product of the plant's production process, was being given away to farmers to be used as fertiliser in their fields. At first the farmers were quite pleased to receive the sludge as it cut down on the amount of money they spent on buying fertiliser. That's until they realised just how dangerous the sludge was.
BACKGROUND
Hindustan Coca-Cola Beverages Pvt. Ltd established a bottling plant on 3rd June 2000 in a 40-acre plot (previously multi-cropped paddy lands) at Plachimada of Perumatty Panchayat in Chittur Taluk of Palakkad District, Kerala about 5 kms west of the Tamil Nadu border of Pollachi in Coimbatore District. The bottling plant was set up at a cost of $25 million and employed around 70 permanent workers and 150- 250 casual laborers. By 2002 the total number of people employed by Coca-cola in the Palakkad plant was around 500. Cola-Cola claims to be committed to ‘protecting and preserving the environment’. However, in India Coca-Cola has been accused of creating severe water shortages, polluting the soil and groundwater, distributing toxic waste as fertilizer to farmers and selling sub-standard drinks in the Indian market which contain high levels of pesticides, sometimes higher than 30 times those allowed by European Union standards. Thousands have been protesting against Coca-Cola throughout India.
Communities across India living around Coca-Cola's bottling plants are experiencing severe water shortages, directly as a result of Coca-Cola's massive extraction of water from the common groundwater resource. The wells have run dry and the hand water pumps do not work anymore. The significant depletion of the water table has documented by, for example, the Central Ground Water Board in India. This plant used to roll out 85 truckloads of soft drinks every day. The company was drawing 10 lakh liters of ground water every day. That was until people began agitating against the company for using up too much groundwater, leaving little for them to use for agriculture, even for their basic household needs. Locals also claimed the water was becoming polluted. Villagers, politicians, environmentalists and scientists all accused Coca-Cola of robbing the local community of their most precious resource – water, and of damaging their health and livelihoods. With time the wells in the area had started drying up and within a few months of the opening of the plant, the quality of water had deteriorated. Also Coca-Cola was accused of distributing sludge from the factory as a fertilizer. Open protests started against coca cola to shut their plant.
THE DISPUTE
“Drinking Coke is like drinking farmer’s blood in India,” said a protest organizer Nandlal Master. “CocaCola is creating thirst in India, and is directly responsible for the loss of livelihood and even hunger for thousands of people across India,” added Master, who represents the India Resource Center in the campaign against Coca-Cola. Indeed, one report, in the daily newspaper Mathrubhumi, described local women having to travel five kilometers (three miles) to obtain drinkable water, during which time soft drinks would come out of the Coca-Cola plant by the truckload. Senior scientist at the Exeter lab, David Santillo, has said: "What is particularly disturbing is that the contamination has spread to the water supply -- with levels of lead in a nearby well significantly above those set by the World Health Organization." Coke officials have always argued that their Plachimada plant conforms to the highest environment management standards. "The plant at Palakkad is certified to ISO 14001 and is open to inspection by all regulatory and accredited monitoring agencies. Allegations that The Coca-Cola Company is exploiting groundwater in India are without any scientific basis and are also not supported either by the
Government authorities who regulate our water use in India, academics, or the local communities in which our plants are located," said an official company spokesperson. The claims of locals were justified when scientific tests proved the same. On April 9, 2003 the Opposition Left Democratic Front-ruled Perumatty grama panchayat (the only panchayat in the State ruled by the Janata Dal, one of the constituents of the LDF) decided to cancel the license of the Coca-Cola Company’s bottling unit. The plant had to shut down. Over a month later, on May 16, the Communist Party of India (Marxist)-led administration of Pudusseri panchayat too announced a similar decision regarding the Pepsi unit situated in WISE Park, within the Kanjikode Industrial Development Area. Coca-Cola promptly approached the Kerala High Court and obtained a stay order against the panchayat's decision. On March 30, 2005 The Minister for Water Resources, Thiruvanchoor Radhakrishnan,
confirmed that there had been depletion of the groundwater table in the area surrounding the Hindustan Coca-Cola's bottling plant at Plachimada in Palakkad district. Replying to a submission by the CPI (M) MLA, V. Chenthamarakshan, in the State Assembly, Mr. Radhakrishnan said the Groundwater Department had subjected 16 wells around the Coca-Cola plant to a study from March 2002 to August 2003 to verify the complaint that the groundwater table in the area was going down due to the functioning of the plant. When the data gathered in March 2002 and March 2003 were compared, it was found that the water level had gone down by extents ranging from 22 cm to 137 cm in nine wells during this period. One well went even dry during the one-year period. In six wells, the water level increased by extents ranging between 21 cm and 110 cm. In July 2003, two more wells went dry. Inspite of the fact that the factory was causing real harm to the ecosystem, the company appealed to Supreme Court against the cancelling of the license. They managed to get clean chit from the government authorities on the plant being up to the environmental standards.
THE MATTER CONTINUES…..
Coca cola had already invested crores of rupees in the project. Also it was Kerala government’s initiative that led to coca cola opening a plant in Palakkad. Shutting the plant would lead to huge losses for the plant. Coca cola had some 13 plants in the country at that time however Palakkad plant was one of the biggest. The factory employed more than 500 people. The employment of these people was under question if the plant had to be closed. The amount invested in the project was huge. Also it had become a matter of prestige and reputation for the company.
DISCUSSION QUESTIONS
1. Should Coca cola continue to operate its bottling plant in Pallakad?
2. Is it ethical for HCCB to appeal in Supreme Court against the case after all the damage it has done? 3. Was HCCB right in distributing sludge as fertilizers to farmers?
4. Is it right for the Government and local authorities to cancel the license once given by them without proper evaluation of the consequences? What else could have been done to benefit both the local population and the company?
REFERENCES:
http://environment.about.com/od/waterpollution/a/groundwater_ind.htm http://www.cokefacts.com/India/facts_in_keyfacts.shtml http://www.financialexpress.com/news/hc-orders-rehearing-of-kerala-cocacola-bottling-plantcase/129400/ http://www.thehindu.com/fline/fl2012/stories/20030620002204600.htm http://www.ethicalcorp.com/content.asp?ContentID=1500 http://current.com/items/89381953_coca-cola-corruption-water-depletion-pollution-murder.htm http://www.dollarsandsense.org/blog/2007/07/challenging-cokes-thirst-for-water.html
doc_180934426.docx