CORPORATE ENVIRONMENTAL LIABILITY IN INDIA

INTRODUCTION

In the words of Environmentalist Robert Swan “Greatest menace to our environment is the optimism that someone else will save it”.

The protection of the environment is a responsibility and an opportunity. In the past 100 years, human beings have plundered and destroyed the natural environment for economic development and their immediate interests, such as the threat of global warming India with the emergence of industrialization and wide growth of the business sector has inevitability created a position of parlance in the global economy. However, it has repressions to the environmental stability of the country. The emergence of opportunities and advancement in the era of urbanization should not subject nature to deterioration and degradation. Environmental destruction has been an issue of concern with the requirement of rampant and constant solutions for decades, with time, the quality of nature has witnessed downfall making its path to exhaustion of natural resources. The statutory responsibility imposed on corporations of preventing the environment is based on the idea that one who has the capability of causing the harm must invoke necessary precautions, remedies, and actions to minimize the same. The doctrine of environment liability is a twofold mechanism- On one end it aims at a cost- recovery based on the ‘polluter pays principle ‘where the onus of monetary compensation is on the one who causes damage to the environment and on the other end provides incentives to potential polluters for prevention of environmental harm.

ENVIRONMENTAL PREVENTION- A LIABILITY

‘The growth of corporate entities should not be at expense of environment’

Environmental liability is the term that defines the process through which liability for degrading the quality of the environment is transferred back to those who cause the damage. The protection of the environment is a necessity as well as a luxury depending upon the economical and social development of the state. However, the notion of environmental protection as a ‘luxury’ is irrelevant in the context of developing countries with the constant battle to cater to the needs of the poor while addressing the degradation of the environment at an alarming rate. The inter-relationship between the notion of economic growth and environmental protection is evident in almost all the countries whether developing or developed.

The responsibility of the corporate entities and the business sector is multifarious in nature as the responsibility is not limited to the production of goods and services but also ensuring environmental prevention and protection in every stage of the production process. It reflects not only a responsibility towards the consumer to produce goods with quality catering to the demand of the market but also a duty to converse the environment.

Harm to the environment can be carried out in numerous ways depending upon the nature of the work of the corporation such as environmental pollution which can be exemplified and recognized; noise pollution, degradation of the air quality, water pollution, and marine pollution. Environmental degradation can be classified into several categories but it is the consequential effect of industrialization. Industrialization is the most evident cause of pollution; however, its harmful nature can be minimized when guided by strict environmental protection regulations and its righteous enforcement and serious implementation. Loss of wetlands, degradation of land and water resources, river pollution and atmospheric pollution and its adverse impacts in form of Global warming, melting of glaciers, rising sea levels are illustrations of environmental harm.

Environmental liabilities imposed on the corporations are from various sources like statutes, regulations, ordinances, declarations, treaties passed at the domestic to the international level. The civil and criminal law also incorporates and addresses the issue of environmental liabilities. There are various reasons or causes behind perpetrating environmental crimes by corporate entities. The crime may be committed due to the ignorance, carelessness of the concerned business entity. They may also be committed as a result of negligence i.e. where the management of the business is highly poorly, human resources are insufficiently trained and infrastructure has not been maintained to the adequate standard, permitting a pollution incident to take place.

Environmental crimes are instances of spoiling public space with advertising posters, illegal dumping of waste notwithstanding that is the result of general sewage waste or chemicals, being discharged into the watercourse. Narrowing down the damages done to the environment it can fall under any of the forms like animal, field, forest, emission, soil, storm, and water.

LEGAL MECHANISM

The status of ‘Fundamental Right’

The expansion of the right to life under Article 21 of the Indian Constitution in the revoluntarily judgment of Maneka Gandhi v U.O.I inspired the judicial body to widen the ambit of the expression ‘right to life’ to include ‘right to a healthy environment’. The imposition of monetary damages on the defaulting industry for causing disturbance to the water is justified on the touchstone of right to life, and duty to protect and improve the environment.

The status of ‘obligation’

The 42nd amendment to the constitution of India imposed a statutory duty on the state and the citizens to protect and improve the environment, by adding article 51 A(g) as a fundamental right and article 48 A to Part IV of the Indian constitution as Directive Principles of State policy. These amendments have acted as a path for building up the regime of environmental jurisprudence in India. Corporate sustainability is defined as the part that companies should play in reaching the goal of sustainable development and requires a balanced approach to economic progression, social advancement, and environmental supervision.

The status of ‘Responsibility’

The Companies Act, 2013 has introduced the idea of CSR- an area of Corporate Environment Liability to the forefront and through its disclose-or-explain mandate is promoting greater transparency and disclosure. Schedule VII of the Act, which lists out the CSR activities, suggests communities be the focal point. On the other hand, by discussing a company’s relationship with its stakeholders and integrating CSR into its core operations, the draft rules suggest that CSR needs to go beyond communities and the concept of philanthropy.

CONCLUSION

‘Corporate environmental responsibility is a statutory practicable resource to sustainable resource management’

The issue of degradation should be urgently innovatively addressed by the corporate. The environmental scandals that occurred and experienced in the past few decades have negatively impacted the employees, consumers, and society. Many corporative organizations have expanded their ambit of research and development wholly by incorporating the foremost accessible technology focused on environmental performance and degradation. Corporate organizations represent a large nexus of society and therefore they must fulfill their social responsibilities by undertaking production activities and techniques that cause minimal damage to humans and the environment.

FAQs

• In which judgment Supreme Court of India held that ‘Right to a Healthy Environment’ is an integral part of ‘Right to life’ guaranteed under Article 21 of the Indian Constitution?

The Supreme Court in Maneka Gandhi v U.O.I interpreted Article 21 of the Indian to include ‘Right to a healthy environment’.

• In which Schedule of the Companies Act 2013 CSR activities are laid down?

The Companies Act 2013, Schedule VII lists down CSR activities to be incorporated by corporate entities.

[Author Megha Solanki, Final Year Student of B.A L.LB at Fairfield Institute of Management & Technology.]

https://www.huffpost.com/entry/robert-swan-antarctica_b_1315047

Cai, Y.; Newth, D.; Finnigan, J.; Gunasekera, D. A hybrid energy-economy model for global integrated assessment of climate change, carbon mitigation and energy transformation. Appl. Energy 2015, 148, 381–395. [CrossRef]

Maneka Gandhi V U.O.I 1978 AIR 597 , 1978 SCR (2) 621