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Exxon's Alaskan Oil Spill-Environmental Destruction on a Giant Scale

In March of 1989, the Exxon Valdez became eponymous with environmental disaster.

Once the accident occurred, Exxon was slow to respond. Containment booms, to prevent the spill from spreading, were not aboard the ship; and while preparedness plans called for a response time of 2.5 hours, it took over 14 hours for the booms to reach the site, by which time the spill was already out of control.

Other methods of containing spills were impractical: skimming could be done to retrieve the oil and mote it to storage barges, but there were not enough such barges in the area for this to be done. Chemical dispersants help to absorb the oil into the water (like dish soap), but there's some argument that the toxicity of these dispersants, along with the fact that the oil is dissolved into sea water, make some consider it to be a worse solution. And burning the oil in such large quantity merely makes the problem airborne.

As a result, there was much argument within the company and with various government agencies about how to deal with the spill, which stymied any action from being taken. Meanwhile, the weather worsened and the spill spread.

The blame was spread between the captain (possibly drunk, but definitely negligent in being off the bridge with the ship so close to shore), the third mate who was unable to keep the ship off the reef, the company (for failing to keep an eye on the captain, sufficiently train the crew, and working conditions that led to fatigue), the coast guard for inadequately tracking ships and icebergs in the area, and the state of Alaska for failing to have a pilot aboard the ship. But ultimately, the public blamed the company.

The litany of charges in the press went beyond those faced in the course: Exxon was seen as slow to react, attempted to shift the blame on others, ducked its own responsibility, was unprepared, was negligent, and ignored signs of danger.

In the wake of the accident, the company spent over $2 billion on the cleanup, reimbursed the state of Alaska for its expenses, granted funds to Alaskan fishermen to compensate for their losses, and took many steps to repair its public image.

What the company failed to do was to act immediately at the time of the incident to contain the spill - and more importantly, it failed to convey a public image of sufficient concern, openness, and contrition.

Analysis

One common denominator to all parties involved was complacency: the oil had flowed through the same shipping lanes for years without a serious mishap, so companies and regulators were lulled into indifference and complacency. Regulatory agencies became slack in their monitoring, the state government failed to keep its systems up to date and recovery mechanisms in a state of readiness, the people of Alaska were generally unconcerned, and even the federal government was criticized for letting companies regulate themselves with little interference.

In the wake of the incident, better safeguards were established, controls tightened, resources allocated, and other measures taken - but as the years pass and there has been no major incident, it is believed that their attentiveness may again become lax, until the next major incident occurs.

Lessons Learned

The environmental lobby of today is vey powerful and continues to gain strength and public support. Businesses must be especially wary of the potential for their operations to impact the environment.

A firm should look beyond its legal liability to the potential impact of negative press. In particular, when an incident occurs, the company should assume an active role to avoid the reputation of being uncaring and arrogant. The "appearance of culpability" that may be created by acting quickly could result in higher penalties in the legal system, but will mitigate the negative public sentiment that, in the end, can be more damaging.

Constant vigilance is needed: just because something hasn't happened doesn't mean that it cannot, and a company that allows itself to become complacent finds that it is unprepared when something does happen.


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