UK - A number of local authority pension funds are coming under pressure from the charity ActionAid to use their investments in mining firm Vedanta to stop an open pit mine in India.
The charity revealed it is targeting councils that have invested in Vedanta through their pension funds, on the basis that they are public bodies, in an effort to gather shareholder support and halt the opening in September of a bauxite mine on the Niyamgiri mountain in India.
ActionAid claimed the mountain area is the ancestral home of the Kondh tribe and is a "pristine eco-system" housing endangered species such as tigers, elephants and leopards that could be threatened with extinction by the mine.
The organisation has already protested against the plans at Vedanta's annual general meeting (AGM) in July, but it is now targeting a number of local authority pension funds with investments in Vedanta including:
Meredith Alexander, head of trade and corporates at ActionAid, claimed: "Shareholders, including Wandsworth and other councils, are investing in a mine that will destroy a community's way of life, at the same time as irreversibly damaging a unique environment. The councils must ask Vedanta to withdraw from the project. The destruction of the Kondh's homeland is imminent. Shareholders have a final chance to refuse to allow their money to be used in this way."
However, a spokesman for Wandsworth Borough Council, one of the local authorities called on to act, argued: "The council has a paramount fiduciary duty to obtain the best possible financial return on its pension fund investments. As the law stands any shortfall in the fund's performance would have to be met by taxpayers.
"So it is important these investments make the best possible return, so taxpayers are not burdened unnecessarily. These investments are managed by independent fund managers who invest in hundreds of different companies and continually keep these investments under review," he continued.
The call for local government pension schemes to become more engaged investors and to take action regarding the companies they invest in has been a long-running issue, as demonstrated by the continued efforts of trade unions and councillors to force the Merseyside Pension fund to adopt an ethical dimension to its investment strategy. (See earlier IPE articles: Liverpool pushes again for Merseyside ethical policy and Analysis: Do members care where the money comes from?)
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