By guest contributors Swetha Somu and Sanigdh Budhia, students at Gujarat National Law University.
The recent case of Milieudefensie et al. v Royal Dutch Shell has shifted the focus back to the dilemma of whether private corporations are outrightly liable for infringing human rights, as defined under the international laws and treaties, or whether only the state is liable for the actions of private corporations under its jurisdiction. The Hague District Court, in this case, ordered a private company, Royal Dutch Shell (RDS), to decrease its net emissions by 45%, in relation to the 2019 levels, by 2030 in line with the Paris Agreement.
Generally, states are held accountable for any violation of private corporations as corporations aren’t recognized as legal subjects. However, there’s a recent shift in the view that corporations are also subjects of international law since they are also contributors to it, even though there is no “hard” law in the form of treaties or conventions that legally bind the parties to it. The UN’s guiding principles on business and human rights were established in 2011, which expects all states and businesses to comply with international and domestic laws regarding human rights but these are simply “soft laws,” that do not impose any legal obligations. However, the use of these soft laws is encouraged by NGOs and unions across the world to keep a check on corporations and their level of responsibility in maintaining human rights.
On the other hand, the Paris Agreement is a legally binding treaty that aims to limit global warming to below 2, if possible, 1.5 degrees Celsius over pre-industrial levels. While state parties are bound by the treaty, non-state parties, such as private corporations, are legally obliged to conform to the laws by acting through their climate change policies.
On 5th April 2019, seven NGOs and approximately 17,379 Dutch citizens filed a suit against RDS in the Hague District Court arguing that Shell is a high emitter of CO2 and the failure to take action against mitigating the emission resulted in the damage to the claimants. The claimants demanded that Shell be ordered to decrease its net emissions.This judgment is an example set in regards to (i) the extent of responsibility of businesses towards human rights and (ii) the degree of compliance to international hard and soft laws for countries and businesses around the world.
SHELL JUDGEMENT IN REGARDS TO INDIAN JURISPRUDENCE
After the tragic incident of the infamous Bhopal Gas Tragedy, the Environmental Protection Act, 1986 was enacted to protect and improve the environment. This was done under the scope of Article 253 which allows legislation to fulfill international agreements. India is a signatory of the 1972 Stockholm declaration which incorporated 26 principles addressing the importance of environmental issues on an international level. Furthermore, in the case of Vishaka v. State of Rajasthan, it was held that in the absence of any discrepancy between domestic and international law, the rule of judicial construction is that international agreements and standards must be considered even while construing domestic law. Thus, it becomes necessary for India to implement the Stockholm principles. Besides this, India is also a part of the Paris Agreement, UNFCCC, Kyoto Protocol, and Rio Convention which emphasize the need for Environmental Impact Assessment to mitigate negative externalities, hence prompting the drafting of the first EIA in 1994.
After a few modifications came, the draft proposal of EIA 2020, which caused a ruckus in the nation. The major modifications in EIA 2020 are the reduction in public consultation hearings and in the frequency of compliance reports from bi-annual to yearly, and most importantly, legitimizing ex-post facto clearance.
Ex-post facto clearance is clearly ultra vires to the existing environmental jurisprudence as it violates precedents such as the Alembic Pharmaceuticals Ltd v. Rohit Prajapati where the Supreme Court, held that ex-post facto clearance is against the spirit of the first EIA, which made a thorough assessment of projects mandatory before their implementation. Allowing ex-post facto clearance inevitably corrodes this jurisprudence.
Furthermore, the “nonsensical phrase” of “post-clearance” will create the void for leniency and less accountability on corporations who make it a routine to breach laws and make up for it by paying penalties. The damage concerning the environment is irreparable and this routine destruction and the hefty penalty is hardly a band-aid doing no good. Corporations need to take active responsibility for their actions and citizens should be given a healthy environment with minimal ecological disturbance.
Furthermore, the Indian judiciary’s creative interpretation of Article 21 has also contributed to the development of modern environmental jurisprudence in India. Article 21 of the Indian Constitution gives the Right to life to its citizens. In Subhash Kumar v. the State of Bihar, the Hon’ble Apex Court held that the Right to Life includes the right to enjoy a pollution-free environment. The term ‘life’, as used in Article 21, does not only refer to animal existence or a life of drudgery; it has a broader meaning that includes the right to a better standard of living, sanitary working and leisure environments, and the right to a clean and healthy environment. Right to Healthy Environment is a second-generation right under International Covenant on Economic, Social, and Cultural Rights, as part of social and economic rights founded under the said covenant.
Therefore, it is disastrous to see the government leaning towards promoting the ease of doing business while shadowing the primary aim of environmental protection. Referring to the M.C. Mehta v. Union of India case, the supreme court held that, if there is a conflict between health and wealth, health would undoubtedly take precedence. The impact of pollution on the environment and human health is so significant that it could not be offset by marginal extra profits made by manufacturers. Polluting industries can even be shut off. Their closure might lead to unemployment, but the health of the people takes precedence over everything else.
Thus, the need of the hour is to enhance environmental protection by making corporations in India accountable for their actions rather than creating laws that pave the way to destruction. The Indian judiciary can definitely take cognizance and inspiration from the Shell decision and hold the corporations in India legally accountable for the non-compliance of international laws and for the lack of respect for the directly infringed human rights. This way, not only the state but also the corporations will work towards the safeguarding of environmental and human rights which reflects the synchronization of the evolution of the society as well as the legal thinking.
Since climate change is a collective problem, everyone in society needs to work for it together – this includes corporations too. The dilemma of corporate human rights obligations is real, controversial yet necessary, and should be recognized and enforced duly across the world. The existing UN guiding principle is merely a soft law and not authoritative enough to address the controversy, hence, the guiding principle, with the consensus from a maximum number of states, should be made into a treaty or a convention. This will not weaken the other existing soft laws rather act as a complementary in promoting human rights, thus cumulatively benefiting the welfare of the society.
Photo 1: “Assessing how Indian farmers manage climate and weather risks in India” by CGIAR Climate is licensed under CC BY-NC-SA 2.0