HUL (Kodaikanal) Plant's Environmental Degradation & Workers' Battle for Compensation: A Case Study.

Date01 October 2023
AuthorBalasubramanian, R.,Patre, Smruti,Balasubramanian, R.^Patre, Smruti

Introduction

The HUL thermometer factory issue was of a high-profile nature, grounded in environmental and labor disputes, unfurled in Kodaikanal, Tamil Nadu, India. The case encompasses Hindustan Unilever Limited (HUL), a well-known subsidiary of the multinational consumer goods company, Unilever. HUL operated a thermometer factory in Kodaikanal spanning from 1983 to 2001. The factory was charged with causing acute environmental pollution and health hazards due to mercury contamination resulting in adverse consequences for the local community. The case focused on corporate social responsibility, worker safety, and corporate ethics igniting widespread rage and calls for accountability. The present case highlights the background of the incident, details of events, and managerial implications focusing on the complex dynamics between critical stakeholdersHUL, the local community, workers, and the environment. It has vital implications on several managerial aspects, accentuating the importance of employee health and safety, CSR, environmental management, compliance, employer branding, and ethical leadership. Organizations must learn from this case and integrate them into their practices and decisions to ensure responsibility and sustainability.

Kodaikanal Won't

"Unilever, the well-known FMCG giant, dumped toxic mercury in Kodaikanal (a popular hill station in Tamil Nadu, India) thus poisoning its workers and the forest. For 14 years, Unilever did nothing to clean up the contamination and compensate its affected workers and their families, despite claiming its social responsibility."

These are the first opening texts shown in the 'Kodaikanal won't' rap video (1) by the Chennai-based singer cum environmental activists Sofia Ashraf. The video firmly demands that the FMCG giant Hindustan Unilever (HUL) clear its mess in the Kodaikanal unit, where they dump the toxic waste. Within two days of release, the video had gone viral and attracted 783,533 worldwide views as of August 3, 2015. The video promoted a campaign on social media and appealed for boycotting of the products of HUL. It pressured the HUL to compensate the workers and restore the environmental degradation due to the toxic wastage at Kodaikanal. The video brought corporate responsibility concerns into the limelight, attracting more supporters for the agitation against the environmental damage done by Hindustan Lever Limited at Kodaikanal.

About Unilever

An Anglo-Dutch multinational corporation, Unilever has its operations spread globally. It is a giant media purchaser globally, spending approximately eight billion USD in 2010 on publicizing its more than 400 brands in vast arenas like sustenance and refreshments. Hindustan Unilever has many famous brands in its portfolio in India, like drinks, cleaning specialists, cleansers and shampoos, individual consideration items, and water purifiers. It has a 67% controlling stake in Unilever. Its products have reached every household in India, and every Indian consumes at least one product. Hence it becomes vital to understand the modalities of its business practices in the Indian diaspora.

Every home in India is likely to consume at least one product of Unilever; hence it is more important to investigate the fairness of its business practices.

HUL Factory, Kodaikanal

Hindustan Lever's thermometer plant at Kodaikanal had a checkered history. The manufacturing plant, which was initially in Watertown, New York, was closed for natural reasons. Cheesebrough Pond's Inc, initially located in the US, shifted its thermometer manufacturing factory to India in 1983 due to strict US environmental regulations because of mercury's toxic effects.

Unilever's subsidiary, HUL, took over this thermometer plant while Chesebrough Pond was acquired. The factory was in Kodaikanal, a verdant slope station in the upper Palani Hills in southern Tamil Nadu. It is one of the famous tourist places and hill stations in India. The hill is home to a rich biodiverse forest ecosystem. It is part of an industrious watershed that merges into the Pambar River.

The town is estimated at 21 sq km, with a populace of 32,000. Unilever's processing plant was obtained after it purchased Chesebourgh Pond's proprietor of HUL, which is Unilever's five percent-controlled Indian back-ups. The plant was one of the giant thermometer plants in India. Unilever imported the required raw material for thermometers, like mercury and glass, from the United States. The factory's annual production was 163 million thermometers using approximately 900 kg of mercury. The USbased Faichney Medical Co. exported these thermometers to Europe and the US.

The industrial facility that produced glass mercury thermometers for fares was part into two main areas:

I% The first area changed over glass tubing into void thermometers, stems, and knobs. Glass scrap from the primary area was sent to reuse glass vendors.

The second area, filled with mercury, denoted the scale, fixed the end, and pressed. The two territories, working with glass, created extensive amounts of the scarp. Glass from the second zone containing mercury was first treated (smashed and warmed) to recoup the mercury.

Back in 2001, a heap of broken glass thermometers contaminated with mercury was discovered by public interest groups from the interiors of Shola Forest. They suspected the mercury factory to be the source of that...

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