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Dow games go on

Posted 24/04/2012 by sevans

Dow Chemical’s sponsorship of the 2012 Olympic games is under fire yet again this week, as protestors ramp up demonstrations highlighting the company’s, albeit indirect, connections with the notorious Bhopal gas leak.

The leak of methyl isocyanate gas from the Union Carbide plant at Bhopal in the Indian state of Madhya Pradesh in December 1984 has been called the world’s worst industrial disaster and was responsible for the deaths of an estimated 20,000 local people and for injuring and blighting the lives of thousands more.

But what then are the facts of Dow Chemical’s involvement? Dow took over Union Carbide (UC), the company that formerly held a majority stake in Union Carbide India (UCI), which owned and operated the plant at the time of the disaster, in 2001. UCI had already been sold to Eveready Industries India in 1994, and later to McLeod Russell of Calcutta. 

A statement on the Union Carbide website maintains that the disaster was the result of sabotage and says the case was settled in 1989 with a $470m payment  ‘more than the plaintiffs’ lawyers had told US courts was fair’  by UC and UCI to the Indian government.

As for the victims of the Bhopal tragedy, many were suffering from ill health and fighting for compensation 25 years afterwards, as an article in C&I (C&I, 2009, 23, 7) pointed out. Around 100, 000 people are chronically sick and more than 30,000 people living near the factory drink contaminated water, according to the report by C&I’s India correspondent. The story compared the size of the payout – a fraction of the amount the Indian government had originally claimed – with the $5bn compensation paid by Exxon for its part in the 1989 Exxon Valdez oil spill. The average sum paid for a death was €886, it reports. It was not until 2010 that eight former UCI executives were convicted of negligence.  

An article in the UK newspaper Daily Telegraph (12 March 2012), meanwhile, quoted UK prime minister David Cameron as backing Dow’s £64m sponsorship deal with the IOC by saying that it would ‘be desperately sad’ if India boycotted the London games over the issue. 

It is hard, however, to feel too much sympathy for Dow. Acquiring another company is not just about buying up the tangible assets and potential revenues; it is also about accepting all of the other baggage that comes along with it. And that includes its reputation – good or bad. 

Cath O’Driscoll - Deputy editor

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