Vedanta outperforms in social and stock indices

http://www.commodityonline.com, March 31, 2009

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MUMBAI: Is a company’s performance in stock indices directly related to its social responsibilities? Pundits would disagree but take the case of big corporate that consciously made their social responsibility as serious as their corporate responsibility, the answer would be simple.

Mining companies face the worst kind of criticism across the globe from various quarters. It is difficult to adjust the work they do for mining with that of the social causes they are in the local regions they operate.

London based Vedanta Resources Plc is already a global leader in aluminum, copper and zinc. As the demand for commodities have touched new low, the Vedanta stock touched its monthly high of USD 705.50 recently from its lows of 503.50 during the first week of March.

The stock has gained over 26% during past one month and was trading at 52-week highs of USD 2788 during June last year.

If the downfall of the stocks compared with others are calculated, it was trading at USD 648 on Nasdaq today up by over 3% from its Monday’s close. There has been a down fall in the stock price over past quarter as the price fell from USD 790.50 during January to USD 628.50 recently.

The reason for such a resistance could be its vision to go shoulder to shoulder with its social responsibilities as well. Orissa’s Kalahandi rhymes like an African nation impoverished in various vicious circles of natural calamities and manmade disasters. Yes, the district was vulnerable but not anymore, thanks to CSR efforts by Vedanta, engaged in mining in the district.

Vedanta Aluminium Limited is the first to get into the CSR in this region for specific purpose. It wanted to show how mining and ecosystem can co-exist and also lift the poverty stricken people from miseries of diseases and development.

And when a diarrhea and cholera epidemic started in these region on March 8, Vedanta’s CSR team sprang into action. The Company also organized a mega-health camp at Kurli two days later where more than 400 patients availed the health services. Medicine and medical consultation were provided free of charge.

Dongria Kondhs tribe at Kurli, Khambesi, and Mundbahali areas were the most affected. These are tribals in Kalahandi where living in pristine natural beauty but without any development and reach of health or other services.

It was here that the company initiated projects to provide improved livelihood to the community, especially women. Now micro enterprises like spice making and leaf plate making is common giving the family the extra income they always vied for.

Dr. Mukesh Kumar, Chief Operating Officer, Vedanta Aluminium Limited, Lanjigarh said helping the locals in such a calamity was company’s primary duty – as sacred as producing aluminum. “Health of people around our plant is highly important for us. As a responsible corporate citizen, it is our duty to provide health care support in advent of any kind of epidemic.”