Internalising Environmental Risk: An Anglo-Indian Comparison

This article explores how corporate and insolvency law frameworks in the United Kingdom and India address the internalisation of environmental risks, particularly for large corporations in high-emission sectors. It argues that while both jurisdictions recognise the polluter pays principle (PPP), their legal systems diverge in operationalising environmental accountability, especially in the context of corporate distress and insolvency. The UK’s approach is shaped by statutory mechanisms and judicial discretion, often subordinating environmental obligations to insolvency priorities. In contrast, India embeds environmental duties within constitutional and statutory frameworks (e.g. Environmental Protection Act 1986), yet enforcement remains inconsistent, particularly under the Insolvency and Bankruptcy Code. Through doctrinal and case-based analysis, the article reveals structural and institutional barriers that hinder the effective integration of environmental considerations into corporate governance and insolvency proceedings. It advocates for legal reform to ensure that environmental liabilities are not externalised during insolvency, proposing a coherent legal architecture that aligns environmental accountability with corporate lifecycle regulation. The comparative analysis offers insights into how legal systems can evolve to support sustainable corporate practices and enhance resilience in the face of escalating climate risks.