Chevron lose historic case about lack of any CSR controls in Ecudaor, appeals follow

A lengthy and at times very bitter lawsuit has finally been settled at least in terms of a financial award between Ecuadorian residents along the Amazon and Chevron. It’s a decision that may have huge repercussions in terms of corporate practices particularly in industries that rely upon natural resources and fossil fuels. The feud actually predates many of the origins of Corporate Social Responsibility (CSR) business practices but might now become a defining moment in how a corporation needs to work within the community where it sets up resource procurement. I say might because as you’d expect both sides in the case have now announced they will appeal the verdict that was made within the Ecuadorian court system.

The origins of the case stretch all the way back to 1993 when local residents launched a lawsuit against what was then Texaco (since acquired by Chevron) for the environmental damage done to their local habitat in the pursuit of oil in the region. Litigation has continued on and off throughout the subsequent 18 years as the inhabitants of Ecuador’s Amazon region originally filed the case versus Texaco in New York City, with the help of the Amazon Defense Coalition a number of indigenous parties in the area compiled a case against the oil giant which showed unacceptable practices in the region over a long period of time. According to this research more than 18 billion gallons of toxic waste had been dumped into the Amazon and tributaries, the company emitted huge amounts of gases with no controls and remarkably confirmed reports that over 17 million gallons of oil had been spilled due to pipeline ruptures. The report also spelled out the wide swath of environmental impact and ongoing health related issues experienced in the region as a result of what is being portrayed as corporate neglect.

In reality a combination of corporate responsibility, public awareness and stronger legislation has improved not just the oil industry but many others in the nearly 2 decades since this trial began, however the financial penalties if finalized will provide a strong barometer for corporations to hopefully do more still to safeguard not just people but the environment when it comes to how they perform. Even now the oil industry especially is being asked to submit financial bonds and deposits as guarantees to cover the cost of any environmental cleanup before oil exploration can even begin (such as recent negotiations in Greenland) and while in a perfect world practices would become so safe that such funds would never be needed the reality is that it’s a dangerous business that harbors a never-ending risk of environmental damage.

The appeal process could be as inflammatory as the case however, Chevron are claiming the a press release that “The Ecuadorian court’s judgment is illegitimate and unenforceable. It is the product of fraud and is contrary to the legitimate scientific evidence” while the apparent victors in the case are also not satisfied. Speaking for the residents group the Assembly of Those Affected by Chevron Luis Yanza said the victory was historic and collective but “Eight billion dollars doesn’t represent a significant amount to repair the environmental damages”. The appeal process continues immediately and I’ll be keen to see if anything is overturned.

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