By Alex MacDonald
LONDON--Shareholders of U.K.-listed mining company Vedanta
Resources PLC (VED.LN) should withhold voting on its annual report
and accounts and oppose the election of its executive chairman at
the company's Aug. 28 annual general meeting, an independent
U.K.-based shareholder advisory body said in a report Tuesday.
PIRC said India-focused Vedanta made $2 million worth of
political donations in the year ending March 31, 2012, as the South
Asian country heads toward general elections. This compares with
around $20,000 in the previous year.
"The board states that it believes that supporting the political
process in India will encourage and strengthen the democratic
process. However, there are concerns with the amount involved,"
PIRC said in a statement. "This is at least 100 times more than
what was donated in 2011...[and] use of shareholder funds as a
donation for political parties is questionable use of shareholders'
money," it added.
PIRC also recommended that shareholders oppose the re-election
of executive chairman Anil Agrawal on grounds that executives
shouldn't also be chairmen. Mr. Agrawal is the company's founder
and largest shareholder. He missed two board meetings, according to
PIRC.
Additionally, the advisory body recommended that shareholders
oppose the election of newly appointed nonexecutive director
Geoffrey Green on grounds that he is a partner at a solicitor firm
that Vedanta uses. PIRC therefore questioned his independence.
Lastly, PIRC recommended that shareholders vote against the
appointment of Deloitte LLP as auditor since its nonaudit fees of
about $5.2 million were more than the statutory fees paid both for
the year under review and on a three-year aggregate.
"This [amount] raises significant concerns about the auditor's
independence," PIRC said.
A spokesman for Vedanta declined to comment on the PIRC
statement.
Write to Alex MacDonald at alex.macdonald@dowjones.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires