May. 27, 2009 - Issue #710: Messages Matter

Issues

Bill C-300

A step forward on corporate social responsibility

In the autumn of 2005, Norway's Council on Ethics began investigating the use of a natural river system to transport and dispose of mine waste in Papua New Guinea. Accused of far-reaching environmental destruction, Canadian mining company Barrick Gold and its Porgera mine's tailings disposal system were placed under close scrutiny.

Issuing recommendations for Norway's $300 billion sovereign wealth fund and one of the largest global pension funds, the council found that Barrick Gold had not only neglected to take measures aimed at reducing the amount of waste produced by its mine, but that it had failed to stop the tailings disposal going directly through a pipeline into the local river system.

After an investigation spanning four years, the council established that "the mining operation at Porgera entail[ed] considerable pollution." The 2008 report went on to condemn the heavy metals contamination, particularly mercury, produced by the tailings. It concluded that severe and long-term environmental damage is likely to continue, and that it represents a serious health hazard for residents of the mining area and for the indigenous peoples living downstream from the mine.

Norway's Ministry of Finance later announced that it had excluded Barrick Gold from that country's pension fund for ethical reasons. Alongside other gold miners, cluster bomb and nuclear weapons manufacturers, Barrick Gold is now denied the opportunity to seek investment from Norway's government pension fund, and has lost the $200 million stock investment previously held by the fund.

While it is a significant blow for Barrick Gold, Canada's largest publicly traded company, the news of the Canadian extractive industry's questionable operations overseas may come as a surprise to many Canadians. It stands, after all, in stark contrast with the recent honours showered upon Barrick Gold's chairman and founder, Peter Munk, who received the Order of Canada the same year Norway's Council on Ethics issued its report. His name also adorns the Peter Munk Cardiac Center and the Munk Centre for International Studies at the University of Toronto.

Canada's lack of enthusiasm for corporate social responsibility (CSR) is rather well reflected in these symbolic gestures. It happens that Canada is a major player in the global mining sector. Canadian mining and exploration companies now account for 43 per cent of global exploration spending. In 2008, over 75 per cent of the world's exploration and mining companies were headquartered here. While the Canadian government encourages Canadian mining companies to conduct their activities in a socially and environmentally responsible manner, the reality is that they continue to fail to integrate, on a voluntary basis, social and environmental concerns into their business operations.

Despite a series of consultations with industry and civil society in 2006, the Canadian government only recently responded to the National Roundtables on Corporate Social Responsibility and the Canadian Extractive Industry in Development Countries. These roundtables were tasked with identifying opportunities to address the growing number of environmental and social conflicts created by Canadian oil, gas and mineral companies operating overseas, but the Canadian government's latest CSR strategy does nothing more than endorse current CSR standards and create administrative mechanisms, rather than legal ones, within the Department of Foreign Affairs and International Trade and at Canadian offices abroad.

With none of the original 27 recommendations from the multistakeholder roundtables being implemented, Canadians have begun sounding the alarm. Grassroots campaigns were held nationwide as sympathizers began to mobilize for the cause, and hundreds of thousands of Canadians have signed petitions calling for change.

The members of the Canadian Catholic Organization for Development and Peace (CCODP) are among the forerunners in issuing this call. On May 12, 2009, CCODP delivered 38 boxes filled with postcards addressed to Prime Minister Stephen Harper. Signed by more than 140 000 supporters, this petition called on the Canadian government to hold Canadian mining companies accountable through legal mechanisms. The total number of cards and letters they have delivered to the prime minister in the last three years is now well over half a million.

And members of the CCODP haven't stopped there. They are throwing their support behind Bill C-300, an Act on Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries. Tabled by Liberal MP for Scarborough-Guildwood Hon. John McKay, the private member's bill imposes tighter controls on the provision of government support to the Canadian extractive companies. It limits eligibility for this support to those complying with environmental, social and human rights standards, such as services provided by Export Development Canada and the Department of Foreign Affairs and International Trade, and not unlike the Norwegian Council on Ethics, the investments made by the Canada Pension Plan in Canadian mining companies.

Regrettably, Bill C-300 doesn't include provisions for an ombudsperson and independent investigation into complaints from overseas, since private member's bills cannot require the support of a budget. As an alternative, complaints would be directed to the Minister of International Trade and Foreign Affairs, and an investigation into whether or not a violation of CSR standards occurred would follow. The results of these investigations could mean bad PR for Canadian mining giants caught violating international human rights standards. While not perfect, the bill
is an important step forward on social responsibility for Canadian companies.

Bill C-300 passed the second reading on April 22, 2009 and the Standing Committee on Foreign Affairs and International Development's hearings on Bill C-300 began on May 25, 2009. When the parliamentary session resumes in the fall, the bill will be considered on a clause-by-clause basis, and if accepted by the majority of the committee's members, it will return to the House of Commons for the third and final reading. V

Marie-Claude Poirier is a recent graduate of Campus Saint-Jean, University of Alberta with a degree in political science and sociology. She has lived in and traveled to Asia on several occasions, and now works in the education sector of the Canadian Catholic Organization for Development and Peace. 

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