New commercials from mid-August to bridge trust deficit, but the jury is out on whether these will work.
Metals and mining giant Vedanta Resources has been on a corporate social responsibility overdrive for long. It’s only now that the company will use that to add some sheen to its brand equity.
The London-headquartered Vedanta has roped in ad agency Leo Burnett to prepare two commercials – one of 60 seconds and the other 90 seconds – which are set to hit prime time television from mid-August. Starcom, which has been appointed the media buying agency, is already booking TV spots for a three-month period.
A Vedanta spokesperson says, " We want to promote the importance of child development in India where every third child is malnourished. We are considering production of a TVC, but it would be premature to talk about it at this point".
Vedanta officials say the group’s CSR activity is driven by none other than Chairman Anil Aggarwal himself. “We will be spending Rs 500 crore this year alone on different CSR related work. Money will not be an issue… We are a $7.9 billion conglomerate,” said another group official.
The group has clearly done a lot on the CSR front: 3,000 angaanvadis in Orissa, Rajasthan and Chattisgarh that take care of the nutritional requirements of 120,000 children; mid-day meals for 250,000 children in 3000 schools; around 2000 women empowerment and self-help groups to set up micro enterprises involving 25,000 women; the Balco cancer hospital in Korba in Madhya Pradesh with 360 beds, out of which 20 per cent will be reserved for BPL families. Besides, there is an upcoming heart hospital in Udaipur and a medical college and research centre in Bharatpur in Rajasthan. An MoU has also been signed with the Rajasthan government for computer training for 50,000 school children from government-run rural schools in four districts and a 150 member dedicated in- house CSR team tracking 2.5 million people.
Advertising and brand consultants say a TV commercial just for propagating CSR is unique. But the reason is obvious. Like many of its peers around the world, Vedanta too is fighting a perception battle which has completely polarized public opinion today. Excessive mining versus human displacement and environmental impact and its co-relation with internal security is being debated in every sphere of civil society.
That Vedanta is a company with a soul is a message that it needs to send out urgently, feel most industry peers. Anand Halve, Director with brand consulting firm, Chlorophyll, says public awareness is very important to change mistaken impressions. “But for Vedanta, consistency and longevity of the CSR work will be key. And it can’t be post facto. Beyond Petroleum is not working for BP,” he adds
The negative news flows about Vedanta have been overwhelming. Even the motives behind all its CSR work, has been scrutinised.
Amarjyoti Naik, regional director of the Orissa chapter of Action Aid India, says he “just doesn’t understand the rationale of a commercial on the so called CSR activity of a corporate like Vedanta. It’s pure opportunism,” he says. Action Aid has been involved in a four-year long struggle against Vedanta’s Orissa project.
Controversies surrounding Vedanta’s Orissa aluminium and power complex have now snowballed into an international human rights and tribal displacement issue with many global investors like Church of England also pulling out their money from the company.
Sustained protests from environmentalists and non-profit bodies like Amnesty International, ActionAid and Survival International, opposing the company’s plans to mine bauxite in the Niyamgiri Hills of Orissa have also ensured that the listing of Vedanta’s aluminium arm VAL is put on hold.
More importantly, the Stage-II environmental clearance from the Union Ministry of Environment and Forests for mining bauxite at Niyamgiri is still awaited. The central government is also proposing a new mining bill, by which it wants to ensure that mining is more socially responsible and the people affected are rehabilitated. Niyamgiri tribals are also protesting, as they consider the hill sacred and worship it.
This despite the fact that in 2008, a Supreme Court bench chaired by the then Chief Justice, K G Balakrishnan, had allowed Vedanta to mine bauxite in the ecologically fragile Niyamgiri hills. The project as it was envisaged then had an investment of around $1 billion (Rs 4,600 crore).
But without the mining approvals, and with such opposition, it will be difficult for Vedanta to take one of its most ambitious project forward.
That is why the television commercial could be perceived as a make-or-break strategy. But Dilip Cherian , image guru, has a different suggestion. “For Vedanta, higher credibility will come if the communication is customised to the actual affected audience and not the general mass via a TV commercial. I would suggest: Invest in a Santhaal channel and use it as a focused communication platform.”
