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BUSINESS ETHICS CASE ASSIGNMENT

The Ok Tedi Copper Mine

Imanda Mulia Rahman 361168

1. The systemic, corporate and individual ethical issues are as follows:


SYSTEMIC
Considering the economic system and environmental system, because the
ongoing buildup of wastes was destroying the ecology of the tropical rain
forests and wetlands through which the rivers flowed and had already
devastated 120 riverside villages, whose 50,000 inhabitants originally had
depended on the rivers for fishing and farming. The people are now
economically dependent on the mine. In addition there is also political-
legal system that is being considered, The inevitable pressure from IMF
and World Bank that made the Government wanted to prove itself they
could manage their own country.
CORPORATE
Since the very first even before BHP scheduled to open, they had agreed
to build and have a large storage facility. They did try to build several
times, but a large landslide kept destroying the foundation of the storage
dam during the construction. They told the government that the area
where the storage facility was to be built was prone to landslides, frequent
earthquakes and huge quantities of rainfall. Which then released a license
agreed by the government for BHP to defer construction of a permanent
waste storage facility. The license was renewed and was never revoked. All
water, rock and tailing produced by the mining operation were now flowing
directly into Ok Tedi River and downstream into the Fly River.
INDIVIDUAL
Paul Anderson, the CEO of BHP, was clearly aware of the problem caused
by the wastes. But he keeps being uncertain and anxious to resolve the
issue but the company had not yet decided what it would do. The PNG
Government is very reluctant to close the mine because the mine provides
foreign exchange, employment and promotes regional development. For
residents in Ok Tedi, they didnt want the mine to shut down because their
rivers have been populated and they had no option but to be dependent
on the mine.
2. The reasons under 3 concepts are:
UTILITARIANISM
The benefits of the mine to operate are that it provides foreign exchange,
employment and promotes regional development. However, weighing the
cost and the benefits, the costs and the negative impacts are too much.
The environmental impacts of the Ok Tedi mine are very visible and very
controversial; starts from the sedimentation, impact on vegetation, toxicity
and water quality to decrease in fish stocks. Which those then lead to
bring negative socio-economic impacts to the people in Ok Tedi.
JUSTICE
Distributive Justice: The distribution of benefit and burden is not
equal. The landowners have to bear the ecology impact that pollutes
the area and will continue to get worse overtime.
Retributive Justice: The BHP had to pay million dollars to the
landowners which increased their expense.
Compensatory Justice: The Landowners received $500 million dollars
in total.
RIGHT
People in Ok Tedi dont have rights to any other option to work for other
than the mine. Because they couldnt no longer do fish or farm to provide
themselves. One more thing, the most basic one, they do have the right to
live in a clean environment that wouldnt threathen their health.
3. BHP has responsible because they are the one who operated the mines and
caused all the pollution or better said disasters to happen. They are the one who
literally decide what can be done and how to resolve the problem by of course
considering the people and the environment in Ok Tedi, as well as the
continuation of their business. But on the other hand, government took the
biggest part of the responsibility, because government was the one who let
these happen in the first place by letting BHP to start operating and open even
without a large waste storage facility and even agreed to make a license so that
BHP was permitted to defer construction of a permanent waste storage facility.
4. Just like the majority owner of BHP who would have liked to close the mine early
after endorsing a statement that the company would refrain from the practice of
riverine disposal in future project, he best option would be better to either
temporarily or permanently close the mine.