Lessons from Bhopal: Financial Responsibility

Another thought I had regarding Bhopal, and in general corporate responsibility regarding damage to life and property is: The government should, for companies owned in part or whole by foreign entities, block all repatriation of money whenever there are lawsuits for compensation due to death or injury above a certain amount. Such companies will not be able to buy foreign exchange under any guise until the court allows them to do so.

Of course the companies will not like such a law, and there will be many protestations regarding possible abuse of such a law. But such a law is needed as a sensible alternative for arrest, when it comes to companies. Individuals can be arrested, thus temporarily suspending their freedom of movement (and many other freedoms). Companies cannot be `arrested’ as such, but their CEOs and other decision-making individuals can be. For companies which are wholly owned by Indians, arrests are sufficient to ensure that the accused in cases of death or injury remain within the reach of courts. For companies which have foreign owners or shareholders, the law does not find it easy to reach those individuals, nor to get a hold of their assets in case compensation is granted. If these companies are stopped from converting their assets into foreign currency, those assets will remain within the reach of the courts till a decision has been reached on compensation etc.

Such a law would be much more useful than a law prescribing higher punishments to people who remain out of reach.

Bhopal : boycott the guilty!

Now that all the culprits in the Bhopal gas tragedy have been found guilty and sentenced to the maximum permissible TWO years in jail — suspended while they are out on a bail of Rs. 25000 each, everyone seems to be busy blaming someone or another, for the triviality of the sentence, for the failure to bring a conviction under steeper charges, for not having stronger laws, for not arranging for bigger compensations, and everything else.

Reading all that, I had a few thoughts of my own. One of them is that it is not a good idea to have a separate law for each and every situation, so we should try to make the best use of whatever laws we have, rather than make up new ones to fit a future Bhopal. Secondly, it is a good idea to have laws which can err in favour of the accused, because it is better to let the guilty walk free than to punish the innocent. Nor is it a good idea to increase the severity of punishment under each and every law whenever someone appears to walk away with no more than a rap on the wrist, because then in most cases people will end up getting punished far beyond what they deserve. While the guilty in the original case get to keep the sentence they originally received.

But this is a democracy, and we the people have some say, at least in some things. I do not favour using that say to overturn existing laws and make new ones at the drop of a hat, as I said above, but there are other things that we can do. We can identify the real culprits — not that it would bring back the dead or cure the blind and the maimed — but we can figure out who should have paid a proper compensation for the lives their greed and negligence ruined. As a first approximation, these are Union Carbide, Dow Chemicals (who now own Union Carbide), Mahindra & Mahindra (whose then owner Keshub Mahindra was also the CEO — or do I mean Indian owner? — of Union Carbide India), and possibly Eveready and Exide, which brands were owned by UC, or they owned UC afterwards, in some convenient book-swapping process.

Anyway, some digging should bring out which are the companies who should have paid compensation to those affected by Bhopal. And also to what extent each owned the Union Carbide plant in Bhopal. Then can we boycott these companies? It need not be done overnight, it is not necessary to start by making a complete list of things to be boycotted, but we can start from any brand owned by Dow or  Mahindra.

I would also like to see a law that any company, which abrogates its responsibility in situations similar to (but hopefully on a smaller scale in future) Bhopal’s, will also lose any right to its intellectual property in this country. This could be linked with how quickly compensation is disbursed, and how much. I have a feeling that such a law will achieve much more, and more quickly, than any reworking of present laws to increase the quantum of punishment.

Spending without a research grant

We all get to hear stories about how research grants are spent or wasted. Recently I came to know about another channel of flow. Every research institute buys instruments from research grants, but also outside research grants. This comes from the institute’s `research budget’, which is usually finagled out of the total budget by the Director. This usually means that there is no money for other things,  whether it is a students’ hostel, or library subscription.

In some places, or perhaps some cases, the allocation of money to buy instruments (or computers) from the institute’s budget follows a procedure similar to a grant application in which a detailed budget has to be made by the principal investigator (PI) and the research proposal has to be defended in front of a committee. Usually this committee is not as strict as the grant committees of the national agencies, but still, there has to be a defence.

A few days ago, I saw some figures for one of the smaller research institutes in the city. In the last five years, this institute has spent about Rs. 100,000,000, mostly in foreign exchange, to buy instruments on its own. Yes, that is 10 crores. On average 2 crores a year. This is without taking into account the instruments bought from sponsored grants, but that figure is not comparable. In other words, granting agencies did not agree to give similar grants to this institute for buying instruments. And I was told that in many cases, these instruments were paid for by the centre because the granting agencies refused to.

The annual maintenance of all these instruments is more than a crore. The support expenses, due to power, air conditioning, and consumables, is probably of the same order. Which is less than what it would cost to promote all the scientists there to the highest pay grade. But that procedure requires application, CV, letters of recommendation, and an interview committee. Why should similar amounts of money be spent without any checks?

Someone suggested that it is because cut money is involved in the purchases. I do not wish to believe him, but I do not have a satisfactory answer either.