Jury On Trial

The controversial aluminium giant Vedanta has just been awarded an environment award. This is a sham

NITYANAND JAYARAMAN
Journalist and Activist

A CONTROVERSY over an ‘environmental management’ award to Vedanta Alumina (VAL) has brought into focus issues of governance and accountability. In the aftermath of the Satyam scandal, the role of independent directors in corporate governance was a hotly debated point. Translate that to highly publicised awards like the Golden Peacock, given annually to corporations by UK-based charity World Environment Foundation (WEF). When an award is given, the media does not go into the integrity of the award-giver or winner. What, then, is to stop the winner and the giver from striking a deal? The jury, one would imagine.

Activists charge Vedanta with violation of indigenous peoples’ rights and desecration of a forest

The Vedanta-triggered Golden Peacock controversy has important pointers that the jury either isn’t really the jury, or that it’s part of the deal. First, some background: VAL operates an aluminium refinery in Lanjigarh, Orissa, and proposes to mine bauxite in the Niyamgiri Hills, held sacred by the Dongria Kondh tribals. Activists charge Vedanta with violation of indigenous peoples’ rights, desecration of a highly biodiverse forest, and perversion of the law in operating the factory. On June 12, in the lead-up to the ceremony, activists took over the stage in Palampur Agriculture University, Himachal Pradesh, and told people about the reality of Vedanta. Sensing trouble, the Himachal CM boycotted the meeting. Samdong Rinpoche, Prime Minister of the Tibetan government-in-exile, walked away from the event after being briefed by activists. In distant Mettur, Tamil Nadu, activists marched to the gates of Vedanta subsidiary MALCO and presented the company with a ‘Ravaged Peacock Award.’ MALCO’s alumina refinery is charged with dumping red mud, a toxic by-product of alumina smelting, on the banks of the Mettur Dam. In a letter, more than 170 organisations wrote urging jurors of the Golden Peacock Award to dissociate themselves from Vedanta and the WEF. The letter says that the basis for the award — the claim of zero discharge from the Lanjigarh refinery — was inaccurate. As evi- JURY ON TRIAL The controversial aluminium giant Vedanta has just been awarded an environment award. This is a sham dence, it includes photographs and a link to a YouTube video, both from April 2009, that capture the release of toxic effluents by Vedanta into the Vamsadhara River. The Orissa Pollution Control Board’s inspection report alleges similar violations.

Three of the 37 jurors have now stated that they had nothing to do with recommending Vedanta. “One year, I went to attend a meeting that [WEF] held. That was it. I have been listed as a juror for Golden Peacock awards. Till date no one has given me information to review. It seems a bit of a sham,” said James McRitchie, editor of internet resource Corporate Governance. US-based Professor William Halal and Dilip Biswas, former chairperson of Central Pollution Control Board, also say they had nothing to do with the award. “Dr [Madhav] Mehra [founder of the awards and jury member] and his close associates make these decisions,” Halal said.

Dr Mehra, however, says that the jury made the decisions, not he. The lack of due diligence is evident from the fact that Satyam was awarded for excellence in corporate governance in September 2008, days before it submitted its cooked-up balance sheet. The award was promptly withdrawn. In his defence, Dr Mehra says, “None of the 20 other organisations who conferred awards on Satyam have come forward to revoke them.” Dr Mehra has announced that Vedanta's award will be reviewed. But who will review the award-giver, and the integrity of the jurors who haven't spoken up?

The writer is a Chennai-based journalist and one of the endorsers of the letter to the jurors

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