Risk to responsibility: Corporate environmental liability in India

Abstract

Corporate environmental liability has emerged as a critical issue globally, particularly in the context of developing countries like India where industrial growth often comes at the cost of environmental degradation. This paper examines the evolution of corporate environmental liability in India, focusing on the shift from a risk-based approach to one prioritizing corporate responsibility. It analyzes key regulations, including the Environment (Protection) Act, 1986, and the Companies Act, 2013, and explores their impact on corporate accountability for environmental harm. The study highlights the challenges in enforcing these regulations, the role of judicial decisions, and the growing emphasis on corporate social responsibility (CSR) and sustainability reporting. Additionally, the paper evaluates the effectiveness of current legal frameworks in encouraging sustainable corporate practices and identifies gaps in the regulatory structure. It also discusses the roles of government agencies, civil society, and the judiciary in ensuring corporate compliance. Finally, the paper proposes recommendations for policy reforms and capacity-building to enhance corporate environmental liability mechanisms, aiming to balance economic development with environmental sustainability in India.