LEAD Action News
LEAD Action News Volume 14 Number 1, October  2013, ISSN 1324-6011
Incorporating Lead Aware Times ( ISSN 1440-4966) and Lead Advisory Service News (ISSN 1440-0561)
The Journal of The LEAD (Lead Education and Abatement Design) Group Inc.
Editor-in-Chief: Elizabeth O’Brien, Editorial Team: Hitesh Lohani, Anne Roberts and David Ratcliffe

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Review of Public Eye Award Nomination: Innospec

[Editor-in-Chief’s note: the following excellent appraisal overlooked one of the references supplied with The LEAD Group’s nomination. If it had been noticed, they would have been able to write something like: “According to the nomination the company in question has been fined by the US Securities and Exchange Commission (SEC), for bribing officials in Indonesia and Iraq to purchase their product” instead of saying “The nomination does not reveal the authority responsible

The Institute for Business Ethics (IWE), University of St Gallen, Switzerland

By The Institute for Business Ethics (IWE), University of St Gallen, Switzerland

University of St Gallen, SwitzerlandDisclaimer: The Institute for Business Ethics (IWE) is mandated by the organizers of the Public Eye Awards to provide an independent assessment of the nominations for the Public Eye Awards from the perspective of business ethics and corporate responsibility, taking in account international treaties and different industry bound soft law agreements. The subsequent report is based exclusively on the nomination documents provided by the organizers of the Public Eye Awards – no additional information regarding the described incident(s) or the nominated company has been included by the IWE. The report has been written on an anonymous basis, information revealing the identity of the nominee has been generally eliminated from the respective documents. The report presumes the validity of the information contained in the nomination documents. IWE does neither shortlist potential candidates nor participate in selecting the winner of the awards.Context

Leaded gasoline has long been recognized as very harmful to people and the environment and as a consequence it has been phased out in the US in 1995 and banned in the EU since the year 2000. Among others, lead is connected to ailments such as hypertension, heart attacks and premature death. It is even claimed that the damaging effect of leaded gasoline on human brains is responsible for as many as 60 million crime cases per year. ( http://www.forbes.com/sites/alexknapp/2013/01/03/how-lead-caused-americas-violent-crime-epidemic/ )

As a consequence, in 2010, the TIME magazine has named leaded gasoline one of the 50 worst inventions of all time. ( http://content.time.com/time/specials/packages/article/0,28804,1991915_1991909_1991817,00.htm )

Yet, there is apparently still one active manufacturer of so-called tetraethyl lead (TEL) which is used for turning unleaded gasoline into leaded gasoline. This manufacturer is accused of contributing to environmental destruction by producing and selling TEL without being transparent about its damaging effects on people and on the environment. The nomination states that despite its ban in many countries leaded gasoline still accounts for close to 1.1 million deaths per year. Beyond the moral problems directly associated with their product, the nominated company has also been found guilty of bribery.

Relevant Agreements, Conventions, and Treaties

Manufacturing a product that severely damages human health violates the right to an adequate standard of living and to the enjoyment of the highest attainable standard of physical and mental health stipulated in Art. 25 of the Universal Declaration of Human Rights and Art.12 of the International Covenant on Economic, Social and Cultural Rights, respectively. Additionally, the right to health is recognized also in the International Convention on the Elimination of All Forms of Racial Discrimination, in the Convention on the Elimination of All Forms of Discrimination against Women and in the Convention on the Rights of the Child.

The engagement in such hazardous practices also violates Art. 11 and 13 of the UN Guiding Principles on Business and Human Rights.

According to the OECD Guidelines for Multinational Enterprises companies are required to prevent or minimize damage to the environment in a manner that is consistent with the scientific and technical understanding of the respective risks (Chapter VI, Art. 4). By insisting on producing such a harmful product the nominee fails to contribute to economic, environmental and social progress with a view to achieving sustainable development as required in Chapter II, Art. 1 of the Guidelines.

On another note, the company in question is claimed to have engaged in fraudulent marketing by misinforming authorities and the public about the evidence-based hazards related to its product. This can be seen as a violation of the provisions on disclosure as contained in Chapter III of the OECD Guidelines for Multinational Enterprises. According to Commentary 33 on this Chapter, the Guidelines explicitly encourage disclosure on environmental risks and on product emissions.

In any case its behaviour violates the provisions of Chapter VII of the OECD Guidelines for Multinational Enterprises which relate to combating bribery, bribe solicitation and extortion. For example, Art. 1 of this chapter states that enterprises should “(n)ot offer, promise or give undue pecuniary or other advantage to public officials or the employees of business partners”. The nominated company’s involvement in acts of bribing weighs heavy particularly in light of the fact that competitors such as Shell and Rio Tinto are active members of The Business Principles for Countering Bribery which offer a good practice model in the fight against bribery. Yet, it must be noted that the nominee has already been sentenced for such violation and there is no evidence for renewed incidences in this context.Finally, participating in the violation of human rights, be it in a direct or indirect manner, is also prohibited by Art. 11 and 13 of the UN Guiding Principles on Business and Human Rights. While the UN Guiding Principles are not binding for companies, they are not voluntary either; they are considered relevant for all companies irrespective of whether or not they pledge to uphold them. The nominee also seems to fail in conducting due diligence in order to “identify, prevent, mitigate and account for how they address their impacts on human rights” (Art.15). Due diligence is moreover also part of the OECD Guidelines (Chapter II, para A.10).The alleged violation of labor laws is not substantiated in the nomination through factual evidence and can therefore not be assessed here.

Voluntary Standards and Commitments

According to the nominating documents, the nominee has not signed any relevant voluntary standards or commitments.

Overall Ethical Assessment: Compounding and Mitigating Factors

It is beyond doubt that leaded gasoline is very harmful both for the people and the environment and that it should be banned on a global scale. The nominated company as a manufacturer of a product that allows turning unleaded gasoline into leaded gasoline is responsible for upholding a market for leaded gasoline and as a supplier of a product containing lead it bears responsibility for the damages caused by TEL. The fact that according to the nomination the company is the world’s only manufacturer of TEL can be seen as an aggravating factor because this means that there is no competitive pressure or no ‘common practice’, which might be cited as a mitigating factor under different circumstances. Instead the company in question bears the sole responsibility for the damages caused by its products. Insisting on producing a product whose ingredients have been declared as harmful by the scientific community, national authorities and international organizations alike, and holding back information on the hazards of itsUniversity of St Gallen, Switzerland product, conveys the impression of a very single-minded actor whose decisions lack any concern for the people and the environment. The fact that the company has not signed any soft law agreements and that it does not react to petitions and e-mails further supports this impression. Finally, even though there is no evidence for a continuation of any kind of involvement in corrupt practices, the fact that the nominee has been fined for bribery in different countries in recent years adds to the picture of an actor with a lack of respect for the law and a very limited sense of responsibility in general.

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