Impact of environmental law on corporate behaviour
- ByAdmin --
- 21 Sep 2024 --
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Impact of environmental law on the corporate behavior
Research & development through product delivery are all impacted by environmental law, which has an indisputable impact on how businesses operate.
Most frequently, legislation pertaining to resource conservation, endangered species protection, hazardous waste disposal, and air and water pollution have an effect on enterprises. Companies risk fines and other consequences if they don't follow all relevant environmental standards.
For projects like building or land development that can have an impact on the environment, businesses might also need to get permits.
The following are a few of the laws pertaining to environment law in India that corporations must abide by:
1. The Water Act of 1974 (Water (Prevention and Control of Pollution))
2. The Air Act of 1981 (Air (Prevention and Control of Pollution) Act).
3. Environmental Protection Act (EP Act) of 1986
4. The 1972 Wild Life (Protection) Act
5. The 1980 Forest (Conservation) Act
Corporate social responsibility (CSR) of businesses:
Section 135 of the Companies Act of 2013 made India the first nation to enact laws requiring businesses to engage in CSR activities and to report such initiatives.
• One of the activities covered by corporate social responsibility as outlined in Schedule VII of the Companies Act 2013 is making sure that the environment is sustainable, maintaining ecological balance, protecting flora and fauna, protecting animal welfare, engaging in agroforestry, conserving natural resources, and preserving the quality of the soil, water, and air. This includes making contributions to the Clean Ganga Fund, which the Central Government established to rejuvenate the Ganga River.
Businesses' obligations regarding the environment:
Companies are required by law to abide by environmental regulations, however going above and beyond environmental compliance can also be profitable. Beyond merely being required by law, operating in a socially and ecologically responsible manner also benefits the company's bottom line.
- Adherence to environmental laws:
Businesses are accountable for adhering to laws pertaining to trade effluents, trash and recycling, emissions into the air, water contamination, etc.
2. garbage and recycling: Companies have to make sure that any garbage they generate from their activities is stored securely, handled properly, and picked up by a company that is authorized to do so in order to dispose of it or recycle it.
3. Conservation and biodiversity issues: Biodiversity encompasses all plant and animal species, their intricate ecosystems, and any genetic variants that may exist within them. Your company's ability to develop and carry out certain operations will be more severely restricted if it is located close to a priority habitat or protected area.
4.Hazardous materials: All businesses must consider the dangers that some materials, such as chemicals, ozone-depleting substances (ODS), fumes, dusts, mists, and vapors, pesticides and biocides, solvents, etc., pose to the public or the environment.
Companies that create, use, store, or dispose of hazardous materials at work must take the environmental risks into account.
Businesses encounter the following difficulties in complying with environmental laws:
Complexity of the law: Environmental laws can differ greatly between jurisdictions and can be quite complex. To avoid incurring heavy fines, businesses must have a complete awareness of all applicable laws and how they affect their day-to-day operations.
• Lack of experience: A lot of businesses lack the experience necessary to handle environmental compliance on an internal basis. As a result, they depend on outside sources, like consultants or lawyers with expertise in environmental law, for advice on how to effectively abide by relevant legislation.
• Uncertainty in regulation policies: a new generation of environmental rules that are changing more quickly in response to novel ideas and theories regarding the effects on human and environmental health. These modifications and upgrades aren't always evident, though.
• Variability across many sites: Depending on their location and jurisdiction, businesses with several locations must adhere to distinct compliance requirements. Regulations in some industries might only cover a specific aspect, such waste disposal.
Nevertheless, despite these difficulties, businesses still have a duty to maintain environmental compliance as part of their corporate social responsibility, which is required in India.
Business is significantly impacted by the environment. It has an impact on resource availability, production costs, and customer demand because many consumers only patronize companies that follow environmental regulations.
To stay profitable and competitive, businesses must take environmental factors into account when making decisions regarding their operations.
Environmental changes can also open up new business opportunities, such as producing goods made of recycled materials or offering services related to mitigating climate change.
In the case of MK Ranjitsinh and Ors. v. Union of India and Ors. WP(C) No. 838/2019, 2024 LiveLaw (SC) 286 the Supreme Court established as a distinct right the right to be free from the negative consequences of climate change. The Indian Constitution's Articles 14 (equality before the law and equal protection under the law) and 21 (right to life and personal liberty) are significant sources of this right, according to the Court. States were obligated to address the underlying causes of climate change and protect the welfare of current and future generations by recognizing these rights.
Conclusion:
In light of the global judicial activism towards environmental protection, environmental law is becoming increasingly important in today's globe. Because it is their responsibility to deliver services while safeguarding the environment, businesses must abide by these standards. Furthermore, the advantages of this compliance surpass the expenses.
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