Human rights fears see Rowntree sell £1.9m Vedanta shares
Amnesty International UK activists wearing aluminium foil masks the offices of Vedanta Resources in London
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Human rights concerns regarding Vedanta Resources have seen a total of £2.2 million worth of shares sold as investors lose faith in the FTSE 100 mining company's operations in India.
Today Vedanta Resources shareholders at the Joseph Rowntree Charitable Trust sold £1.9 million in the UK company; a decision which followed other investors pulling out over concerns regarding the company's human rights approach.
Other investors which followed Rowntree's ethical policy decision, including the Marlborough Ethical Fund and Millfield House Foundation, have also sold their shares, taking the total divestment to £2.2 million.
Last week the Church of England said it was not satisfied at the mining company's human rights and environment approach, and as a consequence pulled out its investment in the firm. The move was followed by a report from Amnesty International which said Vedanta Resources is threatening the health, livelihoods, human and religious rights of entire communities in India due to its unethical practices.
The charity claimed the firm had caused air and water pollution in the eastern Indian state of Orissa that is threatening the health of the local population and their access to water.
Amnesty, along with Action Aid, have said that Vedanta plans to mine bauxite from a mountain in Lanjigarh and the Niyamgiri Hills, in Orissa, which are sacred to the Kondh tribal people who live in the area. The company has already built a refinery at the foot of the mountain, which is reported to be causing severe environmental damage at the expense of the local people.
Susan Seymour, chair of the investment committee at the Joseph Rowntree Charitable Trust, said: "As a responsible shareholder we have serious concerns about Vedanta. We have heard first-hand about Vedanta's environmental and human rights abuses in Orissa and believe Vedanta is pushing industrialisation to the detriment of the lives and lands of local people and at great risk to its own reputation.
"This behaviour may be legal but it is morally indefensible. We have therefore decided to sell our entire stock in Vedanta."
Rowntree has said it acquired its Vedanta shares in October 2008 and wrote to the company in May 2009 expressing concern over its treatment of tribal communities living in Orissa.
On its website the company claims to "ensure that all our businesses are in compliance to all applicable regulations and we strive to uphold all labour rights. We ensure that we are aligned with a host of national and international regulations".
Vedanta also claims to "operate in compliance to all laws and regulations including protection of fundamental human rights of all employees and no breach of human rights occur within our sphere of influence", and regarding Amnesty's particular area for concern: "Our work with the indigenous people like the Dongria Kondhs and the Kutia Kondhs at Lanjigarh has been customised around their needs and cultural veracity".
But ActionAid today welcomed the decision made by Rowntree to pull its shares out of Vedanta, and said it was a case of "more investors realising the truth".
Meredith Alexander, head of trade and corporates at Action Aid said: "Vedanta's proposed destruction of the sacred mountain of the Kondh tribe in Eastern India could destroy their way of life and their precious environment forever.
"The Kondh people are adamant that the mine must not be built. They have lobbied the government, filed legal challenges, and appealed to investors to help stop the company. Today they came one step closer to winning their fight. We now urge other investors to reconsider whether they really want to put their money into a company like Vedanta."