In recent years Vedanta has been the subject of ongoing criticism on account of its operations and plans in Orissa, India. Its operations in Orissa threaten the traditional way of life of the indigenous Dongria Kondh people, and have been associated with many other serious human rights concerns in the area.
Following a process of engagement lasting more than six months, including a site visit last November, the CoE felt that it could no longer profit from the activities of the company, and could see little prospect for pushing it to have greater respect for human rights around its operations. John Reynolds, Chairman of the Church’s Ethical Investment Advisory Group, commented:
I am a passionate advocate for engagement with companies when we have ethical concerns. We have an excellent track record of getting our concerns heard and acted upon by the companies in which the Church investing bodies hold shares… However, after six months of engagement, we are not satisfied that Vedanta has shown, or is likely in future to show, the level of respect for human rights and local communities that we expect of companies in whom the Church investing bodies hold shares.”
The CoE follows in the footsteps on the Norwegian State Sovereign Fund, which divested its $13m stake in 2007 on account of environmental and human rights concerns. The Guardian reported that Martin Currie Investment Management also sold its £2.3m stake in Vedanta last year, and that BP’s pension fund reduced its holdings in the company on account of “concerns about the way the company operates”.
The Financial Times commented on the considerable reputational damage that Vedanta has sustained as a result of its operations and plans in Orissa:
[The Church of England’s move] underlines how the Dongria Kondh issue has become a public relations disaster for Vedanta…it seldom enters the UK press except in connection with the tribal controversy.”
For more information on the situation with Vedanta in Orissa, and what is being done to try to support the Dongria Kondh people and others in the area, see: