Foreign Affairs Committee on June 1st, 2009

[Peter Goldring, Conservative, Edmonton East, AB]

In reviewing under the definition through to the second part here, it says under subclause 4(3):

If the Minister who receives the complaint determines that the request is frivolous or vexatious or is made in bad faith,

And then it repeats again, “the Minister shall provide reasons for this determination”.

I would think that would be an extremely difficult thing to do unless you conducted a complete and full investigation. In other words, you're calling for an investigation. Would that not lead some competitors in competing countries to put forward complaints or put forward issues? How many extractive companies do we have? How many different ones, how many competitive ones, might consider that a method to besmirch another company in the field, by simply putting in an accusation that would be sometimes very difficult to determine whether it is vexatious or frivolous?

[Louise Léger]

Absolutely. It's fair to say that when it comes to the extractive sector, Canada has a huge presence. In fact, about 60% of all the different projects in the world have a Canadian angle to them. That's why the provisions in the strategy go both ways. If a company feels it's being wrongly accused or keeps being the subject of different accusations, the company itself can ask the counsellor to look into whoever is putting up these complaints.

What I have found on the ground is that when you have cases where companies are accused, rightly or wrongly, there is an admission of how pleased they are that there's an independent source that can verify. A company can say, “I'm quite happy to follow whatever rules. In many countries there is no mining code or rules. I do the best I can. I get accused and I can't win because I am a company saying I didn't do”--

[Peter Goldring, Conservative, Edmonton East, AB]

You're labelled.

[Louise Léger]

--“what I'm being accused of having done.”

If somebody from the outside comes in, takes a look, and sees that the company has complied with everything it was expected to comply with, there's an opportunity for the company to be cleared of any of these accusations. Now there's nothing out there, whether good or bad, if a company is accused. Often there's nowhere for that company to go to seek redress.

[The Chair, Conservative, Kevin Sorenson]

Thank you.

We'll go to the opposition.

Mr. McKay.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Mr. Goldring seems to be concerned about the limitations of Bill C-300 to the extractive sector. Why has the government limited itself to the extractive sector?

[Donica Pottie]

Thank you for the question. I think it all stems from the 2005 report of the Standing Committee on Foreign Affairs and International Trade. It notes quite correctly that Canada's involvement in the international extractive sector is enormous, and since that sector requires vast investments and is often quite long term in situ, it needs a special look.

[John McKay, Liberal, Scarborough—Guildwood, ON]

So the answer to Mr. Goldring's question is that the government is concerned about the same thing that Bill C-300 is concerned about. Is that fair?

[Donica Pottie]

We are certainly concerned about the extractive sector.

[John McKay, Liberal, Scarborough—Guildwood, ON]

If I were legal counsel to a mining company, which is not likely going to happen any time soon, why would I, under any circumstances, consent to an investigation by the counsellor?

[Donica Pottie]

There are many reasons. You might consent because you really believe you've done due diligence and you want a chance to demonstrate that you've done the best you can with imperfect information. You might consent because it can be very difficult for companies to continue to operate in environments where the local community is not supporting their operations. You would have an opportunity for informal mediation, and whoever the counsellor is becomes really important to its success.

[John McKay, Liberal, Scarborough—Guildwood, ON]

We agree that who the counsellor is will be rather critical. But on the other hand, you start an investigation and maybe it finishes 10 or 18 months later. Lots of bad things can happen in that time. Yet you are still going to publish a report saying that an investigation was commenced and the consent was withdrawn at the beginning, the middle, or even the end. How can that be fair to the company that may withdraw its consent for reasons that have nothing to do with the investigation? You're prejudicing the process to begin with, but you're also prejudicing the companies that may very well withdraw consent for good reasons.

[Donica Pottie]

The counsellor would have the authority to decide how to term that. If he thought there were good reasons, he could say that. But we can't have a counsellor operating without being accountable, through the minister to Parliament, for what he does, and therefore needing to report on every instance.

[John McKay, Liberal, Scarborough—Guildwood, ON]

But he is accountable to the minister and Parliament.

[Donica Pottie]

You're assuming that at some point in the process the company withdraws consent. But if we're successful, informal mediation would lead to a plan of action or a way to mitigate whatever the complaint was, and that would finish it. The consent would not be withdrawn. There would be an action plan.

[John McKay, Liberal, Scarborough—Guildwood, ON]

But that's a fairly big “if”. There are readily imaginable circumstances where the company may not wish to proceed with the investigation, and yet it will see its name published, with no ability to get any recourse.

My final question before I turn this over to my colleague is with respect to extraterritoriality.

[The Chair, Conservative, Kevin Sorenson]

You have to hurry.

[John McKay, Liberal, Scarborough—Guildwood, ON]

With respect to extraterritoriality, when Norway has a human rights screen, is it mandatory? Is it extraterritorial when Norway withdraws from investing in particular companies? Is the proposed legislation with respect to the U.S. concern extraterritorial?

[Sara Wilshaw]

No, sir, not in my understanding.

[John McKay, Liberal, Scarborough—Guildwood, ON]

All right, and I would respectfully submit, neither is Bill C-300.

[The Chair, Conservative, Kevin Sorenson]

Be very quick.

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

Thank you very much.

You are also a specialist of the round table. I just want to know if you can identify the elements of the government's CSR strategy that depart from those of the round table, and could you try to explain the rationale or justification for such departures?

[Donica Pottie]

I can try.

One area of difference, of course, which all of you would have noticed, is that we don't use the term “ombudsman”; we've chosen “CSR counsellor” instead. While the powers of the CSR counsellor position largely mirror the powers requested or recommended by the advisory committee, the way we've structured it is that we don't have an independent tripartite review committee. And the government selected to go through the minister to Parliament and to have oversight happen that way, instead of through a tripartite review committee.

There were also requests by the advisory committee to condition certain government services based on CSR compliance, and the government decided it would not accept those recommendations—or it didn't accept those recommendations. So that aspect is not in the government's CSR strategy.

[The Chair, Conservative, Kevin Sorenson]

Thank you.

I do have a question, and I'm just going to use a little of the prerogative of the chair to ask it.

Mr. Abbott suggested at the beginning that there isn't a person in this room, and indeed probably in this city, who doesn't want good CSR standards set. I think we all agree on that; all of us understand the importance of Canada being a model to countries around the world.

However, I also have a few concerns, and one of my concerns is that we're going to hurt the ability of some of our Canadian mining and other corporations to succeed. I think good foreign policy recognizes the importance of putting in place standards so that Canadians can prosper at home and abroad. I think that's what we all want. We want to be certain that once we are out and around the world trying to prosper, we're also laying down standards for CSR as we go.

You mentioned that if there were problems or a complaint were brought forward presently, we would approach the company and the company would then have to give the go-ahead as to whether or not it should proceed. Is there a great lineup of companies that say no, don't proceed?

[Louise Léger]

No.