S Kalyana Ramanathan / London July 30, 2009
A persistent campaign by activists to stop metals major Vedanta Resources from mining in Orissa’s Niyamgiri mountains for bauxite got a boost today. The Church of England, that has invested in the company’s stocks, said its representatives will meet Vedanta’s management to discuss the issues raised by human rights campaigners.
Among other things, the Dongria Kondh tribals at Niyamgiri consider the mountain and the surrounding forests as their sacred land, their culture and way of life tied in these. There are also various ecological issues in allowing mining to take place there.
Earlier this week, campaigners from several not-for-profit organisations camped outside the venue where Vedanta held its annual general meeting of shareholders and protested the company’s plans at Niyamgiri. They were urging bodies like the Church of England and local councils (like theMiddlesbrough Borough Council) to divest from Vedanta.
“The independent Ethical Investment Advisory Group (EIAG) advises the three national investing bodies of the Church of England, namely the Church Commissioners, the Church of England Pensions Board and the Central Board of Finance Church Funds. Each body is responsible for its own investment policies, but they are advised by the EIAG, which develops and coordinates ethical investment policy. It offers practical ethical investment advice in a theological context and seeks to promote high standards of corporate behaviour and the principles of integrity, accountability and transparency in corporate life. The EIAG has now met one of the tribal representatives and campaigners on their behalf, and hopes also to meet Vedanta’s management, to discuss the controversial bauxite project in Orissa,” said Louis Henderson, a spokesperson for the Church, to Business Standard.
Th Church’s investment in Vedanta stock is relatively small,at £2.5 million, but a divestment would be a powerfully symbolic gesture and a massive victory for campaigners. Earlier last year, when the Norwegian government withdrew its sovereign pension fund’s $13.2 million investment from Vedanta, it had a profound impact, so much so that the Supreme Court in India cited this action in one of its recent rulings.
The Church of England’s total investment portfolio is in excess of £7 billion. Church investors use their influence as shareholders to improve corporate behaviour. For certain sensitive industries, such as mining companies, the EIAG has a three-year monitoring and engagement process.
The Church is also selective about where its money is invested. “As a rule we do not invest in certain businesses like pornography, tobacco, breweries (alcohol) and armaments,” said Henderson. The Church, he said, looks beyond basic criteria and ensures that even apparently good businesses are conducted ethically. There has been one instance in the past where even though the business was clean, the Church had to pull out its investment on ethical grounds, he said. “After having tried to influence for the better, if we don’t succeed, we divest,” Henderson stated.
In law, the primary duty of trustees, including the Church of England’s central investing bodies, is to produce a good financial return on the investments for their beneficiaries. But, ethical considerations are rigorously taken into account in keeping with the Church’s Christian values, he
“During nearly 30 years of campaigning for the defence of human rights, protection of the environment and the rights of indigenous people, I have seen at first hand the devastating effect that many mining, logging, oil and gas communities have caused to the environment and to communities all over the world, particularly in the developing world,” declared Bianca Jagger, who is spearheading the campaign against Vedanata’s Orissa plans in the UK. “These companies act in the interests of financial gain, rather than the interests of the communities where they operate. These corporations must be held accountable for their actions. They have a duty to conduct business in a socially responsible and ethical manner. They cannot be allowed to cut off the livelihood of local inhabitants, to commit terrible environmental and human rights violations, and to endanger the livelihood of future generations.”