Corporate Environmental Responsibility: A Case on ITC Limited

Case Title:

COSCO Busan Oil Spill: Need for Benchmarking CSR Practices

Abstract:
On 7 November 2007, 58,000 gallons of bunker fuel was spilled in San Francisco Bay, after COSCO Busan, a ship of China Ocean Shipping Company (COSCO), collided with the San Francisco-Oakland Bay Bridge in thick fog. The tidal mechanics of San Francisco Bay caused the oil to spread very quickly, affecting a large area of the California North Coast. Approximately 200 miles of coastline were oiled, closing over 50 public beaches, killing 1,856 birds and 3 ocean mammals. On 30 November 2007, the United States government filed a lawsuit against both the ship and the pilot. On 23 July 2008, a federal grand jury indicted Fleet Management Ltd of Hong Kong, the company that operated the Cosco Busan. The indictment included six felonies for allegedly falsifying documents and criminal negligence for allegedly helping to cause the spill. All this has raised question marks over the CSR practices of both COSCO and Fleet Management Ltd. However, according to initial official releases from public agencies, damage occurred due to the inefficient crisis management of the US Coast Guard. Ad-hoc volunteers were discouraged from cleaning beaches during the early days following the spill, as government workers and private contractor, O'Brien's Group, handled the disaster. OSHA rules were wrongly interpreted as mandatory requirements of HAZWOPER Certification, which prevented the workers from operating. After significant pressure from would-be volunteers, a four-hour 'Disaster Service Worker Volunteer Certification' subset of the course was offered, making the certification valid for only this incident. A group of critics had thus viewed that COSCO's brand image had deliberately been damaged in this case. The incident also had raised debates over the need for benchmarking the CSR practices.

Pedagogical Objectives:

• To understand the cause and extent of the oil spill.
• To understand the risk associated with maritime operation and thus the preventive steps to be taken by the companies to minimise the risk.
• To have a brief understanding about the corporate social responsibility of Regal Stone Ltd, the company that owned Cosco Busan.

Keywords :  Major oil spills, Environmental damages, Clean up actions, Going Green, M/V Cosco Busan, San Francisco Bay, Fatal environment, Aftermath of oil spill, Vessel traffic measures, Regal Stone Ltd, Fleet Management Ltd, O'Brien's Group, US Coast Guard, Oil clean up process, CSR practices