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Case Study: The Question of Corporate Responsibility

by Dr. Robert C. Solomon

University of Texas at Austin

In January of last year, the S.S. Vulgass, an oil tanker of the Big Dirty Oil Company ran around in the area just north of Vancouver, spilling millions of gallons of crude into the waters and onto the beaches of British Columbia and southern Alaska. The damage to the beaches and wildlife and consequently to the tourist industry, the ecology and the quality of life of the local residents is incalculable, but in any case will require many millions of dollars for even the most minimal clean-up.

The ship struck a small atoll, well-marked on the navigational maps, but it was a dark night and the boat was well off course. On further investigation, it was discovered that the Captain of the Vulgass, Mr. Slosh, had been drinking heavily. Leaving the navigation of the ship to his first mate, Mr. Mudd, he retired to his cabin, to "sleep it off." Mr. Mudd had never taken charge of the ship before, and it is now clear that he misread the maps, misjudged the waters, maintained a speed that was inappropriate and the accident occurred. Subsequent inquiries showed that Captain Slosh had been arrested on two drunk driving convictions within months of the accident. The Vulgass itself, a double-hulled tanker, was long due for renovation and, it was suggested, would not have cracked up if the hull had been trebly reinforced, as some current tankers were.

R. U. Rich, the Chief Executive Officer of Big Dirty Oil declared the accident a "tragedy" and offered two million dollars to aid in the clean up. The Premier of British Columbia was outraged. Environmental groups began a consumer campaign against Big Dirty Oil, urging customers to cut up and send in their Big Dirty Oil credit cards in protest. In a meeting to the shareholders just last month, CEO Rich proudly announced the largest quarterly profit in the history of the Big Dirty Oil Company. He dismissed the protests...