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21 Jan 2014

Gordon Bennett, Lincoln's Inn, in Lawyers for Better Business blog

1. Lessons from the Vedanta case: what next?

The Dongria Kondh victory in a decade long battle to prevent mining in their sacred hills should alert company directors to their responsibilities towards communities…In early January India’s minister of Forests and Environment vetoed a $1.7 billion mining project in the Nyamgiri Hills, Odisha…What next? In India, proceedings may now be brought against Vedanta’s subsidiary for violations of the Forest Rights Act…It might also be possible to launch proceedings in England…Section 172 of the UK Companies Act requires directors to “have regard to” the impact of their decisions on the reputation of their company and on the communities affected by its operations. The UK government has insisted that…[it] means “thinking about”; it is absolutely not about just ticking boxes…[W]e believe it will in many cases, [mean] that the proper course is to act positively to achieve the objectives in the clause, that will be the directors’ duty…