A shareholder resolution calling on Alcan to appoint an advisory group on a controversial bauxite project in India garnered 36% shareholder support, an exceptional level of support for a social proposal in Canada.

The resolution was filed by the Oblats Missionaires de Marie-Immaculee and was co-filed by The Ethical Funds Company and Batirente Inc.

At Alcan’s annual meeting April 27, 36 per cent of the shareholder votes cast supported the resolution.

“The support of more than of more than one-third of the shareholders to a social proposal filed for the first time is exceptional in Canada,” said a release issued by Batirente and the Regroupement pour la responsibite sociale et l’equite (RRSE), an investor advocacy group representing the Oblats and other religious organizations in Quebec.

The Alcan proposal follows years of public opposition to a proposed bauxite mine and aluminum smelter (the Utkal project) in the Kashipur region of India. Alcan owns 45% of the joint venture set up for this project with Aditya Birla-Hindalco. Public protests have been marked by police violence.

The Oblats proposal called for Alcan to sponsor an advisory group with a mandate to recommend improved assessment and consultation procedures regarding the Utkal project. It called for the “free, prior, and informed consent’ of the local community, an emerging standard that ensures companies have the full support of local communities before engaging in project development.

Alcan CEO Dick Evans said the company has not yet made a decision to proceed with the project.

"We have not yet made a decision to participate as an equity partner and are not yet convinced that the project meets Alcan's high standards from both financial and sustainability standpoints," Evans told the annual meeting.

He added that if Alcan does decide to proceed with the development of a new bauxite mine and alumina refinery, the company intends to hire an independent organization to assess social and environmental impacts.

The Oblats proposal also won support from Amnesty Canada, which backed the proposal as part of its new Share Power Campaign this year. Amnesty urged its members who are investors in Alcan to support the proposal. It also urged its members to write to mutual funds and pension funds to support the proposal.

Some major institutional investors backed the resolution. While it is too early to say how many major institutions voted in favour, a check with the CPP Investment Board website shows that CPPIB voted in favour of the Oblats proposal.

For more information:  http://www.alcan.com/web/publishing.nsf/Content/Joint+Venture+in+Orissa

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