Activists have been waging war against Vedanta ever since the Niyamgiri mine was first proposed, though the company's board has so far refused to bow to the pressure.The swines! Seth is here to stamp his little feet and screw up his little face and make those bullies do what he wants, or else!
In the wake of the Rowntree divestment, Bianca Jagger has issued a call to arms, urging other shareholders to follow suit and sell their stock in Vedanta. Although she is right to continue with her quest for justice, there is an air of futility about the approach being taken to try to force Vedanta's hand.Oh. why?
Vedanta is a FTSE 100 behemoth, and as such is far less susceptible to boycotts than a smaller company would be. By definition, FTSE tracker funds have to hold a proportional weighting in Vedanta, regardless of criticism of the company's ethics or policies.Let me translate that into English: Verdanta is too big to force it to do as a small group of single-issue fanatics wants.
And that's apparantly a flaw...
Similarly, save for a tiny minority of dedicated ethical funds, most major investment companies are minded to buy or sell Vedanta stock on the basis of its balance sheet and long-term prospects rather than issues of principle and morality.Oh, horrors! People invest in something because it's a good prospect, not because it conforms to some nebulous, ever-shifting moral principle!
What would have a far greater impact on reining in immoral corporate behaviour is a tougher approach from financial regulators.Really? What do financial regulators do currently, then?
At present, if companies breach market regulations governing financial practice, their shares are suspended and cannot be traded. Such measures deal a serious blow to the underlying company and forces it to abide by market rules in order to maintain its listing on the stock exchange.Hmm, you mean, they regulate companies to ensure that they don't break any, oh, what do you call them? Ah, yes. Laws:
Fear of suspension and delisting acts as a heavy deterrent to those who might be tempted to engage in false accounting and other financial crimes.And quite right too! We can, after all, all agree that we elect politicians to make laws based on what is good for society.
Not on what is good for a bunch of patchouli-smelling activists and bored socialites...
Yet in the case of companies breaching human rights laws or environmental regulations, no such punitive measures are taken by market regulators, hence public companies are far less constrained in their non-financial dealings than they should be.Savour that; ‘..than they should be.’ According to Seth and his fellow travellers, that is.
A panel regulated by the FSA or other independent body ought to be established to maintain fit and proper checks on companies' ethical practices rather than just their financial ones.And who defines what are ‘ethical practices’?
Oh, wait. I’m sure I can guess…
Only that way would companies such as Vedanta sit up and take notice when it comes to their actions. As it is, Vedanta's share price will continue to fluctuate according to commodity prices, and will have little correlation to individual acts of divestment.So your little protest has failed to bring them to heel - because not enough people give a damn, and quite rightly - so like any other little kid who picked on the wrong target and got the snot beaten out of you, you run crying to big brother to save the day...
Thanks to heavy scrutiny in the wake of the credit crisis, banks and other financial institutions have been forced to clean up their act in line with political and public demand. Conditions are clement for even tighter regulations to be put in place so that companies such as Vedanta are less inclined to dispense with basic morality in their day-to-day activity.Yeah, good luck with that one, Seth.
When you've finished your little tantrum, the world will still be spinning on its axis, and people will still not be taking any notice of you....
3 comments:
So why do these besandled, "Patchoulli smelling" hippys, not ask what good the Indian space programme is doing for the "environment", and "How is it helping tribes"?
We can NOT bring the Indian "GOVERNMNT" to task now can we?
Because "that would be unenthicnal".
Perhaps there is an instinct driven need for human beings to raise children and since many of our overlords and overladies are child-free (or nowhere near maxed out in their parenting capacity) the lack of opportunity to do this causes them to start nannying strangers in order to compensate.
Might sound harmless, but the difference is that the above would be an instinct and thus not easy to control if at all possible -- whereas 'lust for power' is something you can cure by resetting the relationship they have with the world.
"So why do these besandled, "Patchoulli smelling" hippys, not ask what good the Indian space programme is doing for the "environment", and "How is it helping tribes"?"
Still raises my blood pressure every time overseas aid to India is mentioned without the corollary from whatever spokesman or journalist is merntioning it that they have a space programme, for the love of god!...
"...whereas 'lust for power' is something you can cure by resetting the relationship they have with the world."
I've got a few ideas for that cure. And it'd be permanent.
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