Bill C-584 (Historical)

Corporate Social Responsibility of Extractive Corporations Outside Canada Act

An Act respecting the Corporate Social Responsibility Inherent in the Activities of Canadian Extractive Corporations in Developing Countries

This enactment is intended to ensure the extractive activities of Canadian corporations in developing countries respect Canada’s commitments under international law and the International Bill of Rights. It creates the Office of the Ombudsman and requires corporations to report to it on their extractive activities. It also gives the Office of the Ombudsman responsibility for developing guidelines on best practices for extractive activities and requires the Ombudsman to table an annual report on this Act and its operation before each House of Parliament.

Corporate Social Responsibility of Extractive Corporations Outside Canada Act

[Robert Aubin, NDP, Trois-Rivières, QC]

Mr. Speaker, I always thought that economic development, economic growth and wealth creation were not meant to be an end in themselves, but a way to provide the best quality of life to the most people. I imagine that many of my constituents agree with me, since they gave me the honour of electing me in 2011. What is good at the national level should also be good at the international level. That principle underlies what I have to say about Bill C-584, introduced by my colleague from La Pointe-de-l'Île.

We are debating an extremely important bill, and I think it needs to be passed urgently. Corporate social responsibility is, without a doubt, a central element of our diplomatic arsenal and the image that Canada projects in developing countries, especially in the extractive sector.

First of all, I want to talk about a series of key points that can help us understand why this bill is so important. More than 75% of international extractive companies have their headquarters here in Canada. Furthermore, more than 1,000 mining companies are registered on Canadian stock exchanges. Canadian mining companies invest a lot of money abroad, and there are more than 8,000 exploration properties and mining projects in a hundred or so countries.

The government has a responsibility with respect to the activities of these companies, and it must ensure that their standards and practices reflect Canada's commitments in terms of international law, human rights and environmental law. Canada's responsibility is made even greater by the fact that the countries in which the extractive companies are working are all too often struggling with chronic political instability, high levels of corruption and, sometimes, military conflicts. Sadly, some mining companies are lacking in transparency and ethics, which aggravates the political instability in these countries and does not contribute to the economic and social development of the people. As I said earlier, that is what we want to accomplish.

However, civil society has not remained unmoved in the face of all this. A round table was as created, and NGOs and mining companies have been able to work together and discuss the need to create and promote a Canadian corporate social responsibility framework. One of their main recommendations, which was very simple but also very effective, was to create an ombudsman position, which would be responsible for corporate social responsibility, or CSR. The ombudsman position is covered in this bill, introduced by my colleague, the member for La Pointe-de-l'Île.

The voluntary regulation of extractive activities is an obvious failure. In order to address human rights and environmental violations by extractive companies, the Conservative government came up with a wonderful process, a miracle solution known for its success: self-regulation. We have heard about this in many sectors, but I will not go into them. The Conservatives' approach led to the resignation of the first counsellor, Ms. Evans. Furthermore, if anyone is interested, it seems that the position is still vacant.

The Office of the Extractive Sector CSR Counsellor lacks the authority to investigate complaints and has no legal power to ensure that stakeholders participate in good faith in the arbitration process. In other words, it is a big empty shell. In short, the mandate of the Office of the Extractive Sector CSR Counsellor is setting the stage for failure insofar as mining companies committing violations are not likely to be subject to a thorough investigation or economic sanctions encouraging them to adopt best practices.

In conclusion, you might say that the counsellor did not achieve the ultimate objective she was assigned, which was to strengthen the accountability of Canadian mining companies operating abroad. The dysfunction of the Office of the Extractive Sector CSR Counsellor is leading us to introduce a more effective legislative mechanism by establishing a CSR ombudsman.

Before addressing the issue of the CSR ombudsman, I would like to give an overview of the NDP's contribution in this area. My colleague, the hon. member for Ottawa-Centre, tabled a bill to establish the duty of due diligence in respect of the activities of mining companies in the Great Lakes Region of Africa.

Under his bill, companies working in this region of Africa would have to control their supply chain from the moment the mineral is extracted until it is incorporated into the final product. The hon. member for Burnaby—New Westminster introduced a similar bill, Bill C-323, which allows persons who are not Canadian citizens to initiate tort claims based on violations of international law or treaties to which Canada is a party if the acts alleged occur abroad.

Along with the bill introduced by the hon. member for La Pointe-de-l'Île, these two bills form the legislative backbone of the NDP's efforts to improve accountability and promote values such as respect for human rights and environmental standards.

Now, let us focus on the role of the ombudsman. Creating an ombudsman is a response to a recommendation made by the 2007 national roundtables on CSR and the Canadian extractive industry. I would remind the House that we are somewhere in 2014 and that there has not been much movement on that. The report was written jointly by civil society—meaning NGOs and major unions—and mining companies. The idea of creating an ombudsman is also a response to the characteristics of certain African mining sites.

In a 1992 report, the World Bank identified mining as a growth sector in the African economy. The African mining sector received foreign investment, a factor in economic development. Of course, opening up the mining sector to private investors unfortunately meant that governments withdrew their structural support.

The result of that withdrawal is that governments are no longer responsible for regulating mining activities. Instead, they focus on creating an attractive legal and tax environment for private investors. Consequently, amending mining and tax codes weakened the governments' ability to regulate.

Ghana is a perfect example. After a decade of draconian budget cuts, the government no longer has the human and financial resources to ensure that the development of the mining sector addresses the challenges posed by economic, social and environmental development.

The deregulation of the mining sector was not backed by a proper regulatory framework to support socio-economic development. Quite the opposite. The deregulation of the mining sector contributes to environmental degradation and human rights violations.

The extreme deregulation of extractive activities stalls development instead of giving local populations the kind of leg up they can and should be able to take advantage of. In Burkina, the mining code does not provide for environmental assessment during the exploration phase, nor does it give equally qualified local workers priority for employment in the mines.

A report from the Extractive Industries Transparency Initiative mentioned that financial benefits for African states following the deregulation of the mining sector were minimal. Mining companies almost all avoided paying income tax and capital gains tax. It is unacceptable that Canadian mining corporations should hinder economic development efforts in developing countries.

The CSR ombudsman would promote the institutionalization of a code of conduct for the Canadian mining sector operating abroad. The code of conduct would be based largely on standards set by the OECD and the International Finance Corporation. In addition, our proposal has the support of a broad coalition of stakeholders, including mining companies.

I still have so much to say, but I have run out of time, so I will stop there. I strongly support the bill introduced by my colleague from La Pointe-de-l'Île.

[Lois Brown, Conservative, Parliamentary Secretary to the Minister of International Development]

Mr. Speaker, I am thankful for the opportunity to speak to this tonight. I am a late addition to the speaking role, but I am thrilled to be part of this.

I first want to say how incredibly proud I am of the members of PDAC, the Prospectors and Developers Association of Canada. I have had the opportunity over the last number of years to visit its convention in Toronto, where I meet its people who are part of the mining industry here in Canada, the suppliers. Most importantly, I meet there the people who I had the opportunity to meet when I was in Africa. I have done extensive travelling in Africa and I will tell everyone why I am so connected there, but first I need to tell my hon. colleagues how important it is to speak about Ghana and Burkina Faso, two of the countries he mentioned.

One of the most important things we can do as Canadians is to help African countries take responsibility for their own resources and see the benefits of those resources in the hands of the people in Africa. In our budget three years ago, we established the Canadian International Institute for Extractive Industries and Development, which is a coalition of the University of British Columbia, Simon Fraser University and École Polytechnique in Montreal. I had a meeting with them in August when I was in British Columbia at UBC and we had a very robust conversation about the initiatives that the institute is taking.

Complementary to that, we have helped to establish the African Minerals Development Centre. Canada is the largest contributor to that initiative, having contributed $15.3 million over five years. I was at the funding conference last December in Mozambique and they are absolutely thrilled with the kind of work that Canada is doing to help them establish their own regulations and legislation to become independent, self-regulating countries, which see the benefits of those resources in their own countries.

I spent an hour with the minister of mines from Mozambique, the hon. Minister Bias, who has been involved in the mining industry for a good portion of her adult life. She is the one who is going to be leading the African Minerals Development Centre through the next two years as it establishes itself. It is going to be housed with the African Union and the African Union Commission in Addis Ababa. The oversight of the African Union is going to be responsible to the African Commission. The ministers of mines from every African nation who attended the conference in Mozambique are absolutely thrilled that they are going to have the assistance of Canada to get this institute established.

I will read a quote from the African Mining Vision website. It states:

The Africa Mining Vision is a pathway, formulated by African nations themselves, that puts the continent’s long term and broad development objectives at the heart of all policy making concerned with mineral extraction.

I also spoke about the adoption of this by the heads of state in February 2009, which was put together following the October 2008 meeting of the African ministers responsible for mineral resources development. They want to move from the historic status of mining exporter of cheap raw materials to manufacturer of supplies and knowledge-based services.

I was very pleased to be in Botswana the first time I was in Africa to see the centre where all of the diamonds, which used to be taken out of Botswana and sent to Amsterdam and Belgium, were graded and cut. All of those good service jobs were taken to Europe.

Now in Botswana, outside the De Beers facility where the minerals are actually graded, it is Botswanian people who have the opportunity to do the cutting and the polishing of those stones. It is creating really good, paying jobs for African people. Now, Botswana has moved to what is considered a middle income country in Africa. It is providing opportunities for the people there. It is exciting to see that those things are happening.

My colleague the Parliamentary Secretary to the Minister of International Trade talked a bit about the equator principles that Canada signed on to many years ago.

The other thing that we signed on to, because we believe that Africa and these emerging economies need to have control over their own resources, is the extractive industry's transparency initiative that we joined in February 2007.

The extractive industry's transparency initiative is the authoritative source on how countries can implement the EITI. It is the global transparency standard for improving governance of natural resources. There are 12 initiatives in all, but I will just read a couple of them into the record because it is important that people understand that we believe these CSR initiatives are so important. It says:

We recognise the enhanced environment for domestic and foreign direct investment that financial transparency may bring....

We are committed to encouraging high standards of transparency and accountability in public life, government operations and in business.

We believe that a broadly consistent and workable approach to the disclosure of payments and revenues is required, which is simple to undertake and to use.

There are nine others that I do not have time to read.

It is important for people in this chamber and for people who are watching to understand that I consider Africa my family. My son-in-law is from Ghana. My son-in-law came to Canada with a masters degree in physics. He completed a second masters degree here in material sciences, and then he went on and finished his doctorate in the United States in electrical engineering. Kofi and my daughter have just spent the last year living in Tarkwa, Ghana, where my son-in-law, Dr. Kofi Asante, has been guest professor at the University of Mining and Technology. Ghana was not called the Gold Coast for nothing. It has inordinate amounts of gold in its soil, and the job that my son-in-law has had over the last year is to help Ghana see the benefit of those resources go into its own economy.

With a doctorate in electrical engineering, Kofi is also helping Ghana utilize the solar power that it has. He has just signed a contract with the government to provide a 20-megawatt energy facility, so that the country can use its solar power. It is scalable to 70 megawatts, and it is such an exciting project.

I leave my colleagues with a very poignant story. My daughter was teaching grades 4 and 5 English at the school connected to the university. While she was there, she used letter-writing as one of her tools for teaching composition. She had the students in her class write letters to the school here in Ontario where she had taught. A little girl in grade 5 by the name of Ama wrote—and it is something that I have memorized because it underlines everything that we want to see happen in Africa. Ama wrote in her letter to a little girl here in Canada that she is so glad to be in school because she wants to be somebody in the future.

That says everything that Canada wants to see happen in these emerging economies. We want to give Ama a future, a hope, and an opportunity. Our companies that are investing there, doing really good corporate social responsibility, are going to help these African nations get on their feet, utilize these resources, and become sustainable, developed economies.

[Peggy Nash, NDP, Parkdale—High Park, ON]

Mr. Speaker, I am very pleased to speak in support of Bill C-584.

I am following on the heels of my colleague from Newmarket—Aurora, who has just told us some very positive stories based on her personal experience, and I have no doubt that there are positive stories and positive experiences with the extractive sector.

I am from the city of Toronto and our stock exchange, of course, is heavily invested in the extractive sector. I too have attended the Prospectors and Developers Association conference in Toronto for a few years now. It a huge, wonderful international gathering of representatives from the extractive sector. We were very proud to host that major international convention in our city of Toronto.

To begin with, let me say that there are very many positive role models and examples of companies in the extractive sector that we look to as leaders, both here in Canada and around the world. However, sadly, that is not the case for all companies in all parts of the world.

I will begin by citing an article from the CBC that was written last year, and it will speak for itself.

Tens of thousands of Colombians took to the streets of Bucaramanga, the country's sixth-largest city, last month to defend their water supply from a Canadian-owned gold-mining project.

The chief target of their protest was Vancouver-based Eco Oro Minerals Corp.

The company is exploring for gold and silver in a high-altitude, environmentally sensitive area that is the main source of water for Bucaramanga's one million inhabitants.

This was the fourth anti-gold-mining demonstration in the area since 2010, and one of the biggest.

But Eco Oro shouldn't feel singled out. It is only one in a string of Canadian mining and exploration companies that have drawn the ire of local communities around the world.

On March 12, for example, more than 10,000 Greeks protested in Thessaloniki against several gold mining projects owned by Vancouver-based Eldorado Gold.

Then on March 21, Catholic priests marched with 5,000 locals in Matagalpa, Nicaragua, against a project owned by Vancouver-based B2Gold Corp.

Canadian companies have also been targeted in Ecuador, Peru, Bolivia, Dominican Republic, Slovakia, Romania and Israel.

“Canada is very well represented in global mining conflicts because, in large part, Canada is the home of most of the junior mining companies of the world,” says Ramsey Hart, the Canada program co-ordinator at Mining Watch, an Ottawa-based advocacy group.

The reason for this, he says, is that Canada has a favourable environment for high-risk, speculative investments, the kind that drives international mineral exploration.

Unlike the U.S. Alien Tort Statute, which allows foreign citizens to bring American companies to U.S. courts for abuses committed in a foreign country, there are no mechanisms to hold Canadian companies overseas accountable for their social and environmental policies. "We've just completely dropped that ball," Ramsey says.

The article continues:

The last attempt to impose minimum standards on Canadian companies was a bill sponsored by the opposition Liberals that would have set international standards for human rights and the environment for oil, gas and mining companies operating abroad, and would have made government political and financial support contingent on compliance.

Bill C-300, however, was defeated by six votes in a minority parliament two and a half years ago.

New Democrats joined and supported that vote. However, 17 Liberals were absent, which is unfortunate because they would have made enough to carry that vote and we would have had action on this file.

Thank goodness for the New Democrat member of Parliament for La Pointe-de-l'Île and her bill on corporate social responsibility in the extractive sector. What is being proposed in her bill is exactly what we need. It is a bill that would create a corporate social responsibility ombudsman for the extractive companies doing business in other countries, which is exactly what this news article was talking about.

It would also allow Canada to live up to the reputation that we want to have abroad. Canada is a country that believes in social justice, protecting the environment and defending human rights. This is the image that Canadians surely appreciate of our country. When we travel abroad, it is the image that we want to portray. Whether inadvertently or intentionally, we do not want companies that can be seen as ambassadors to let us down on any of these fronts.

The bill proposed by our colleague from La Pointe-de-l'Île would respect our commitments under international law and the international bill of rights by creating an office of the ombudsman. This would require corporations to report to the office on their extractive activities. It would give the ombudsman the responsibility for developing guidelines on best practices for the extractive activities and require the ombudsman to table an annual report on how companies around the world were doing to the House of Commons and therefore to the people of Canada. That is very important.

I began by saying that Canada was a world leader in the extractive sector. We are very proud of that. Close to 75% of the world's extractive companies are headquartered in Canada. However, many of the countries in which these companies operate sometimes have fragile democracies. They may not enforce human rights or environmental standards as well as Canadians or the citizens in those countries would like. Sometimes the mining companies, with their business endeavours, can create instability in these so-called host countries.

Sometimes these countries lack either the political will, the capacity or the ability to enforce protective measures that would actually defend the citizens they should represent. We believe Canadians do have some responsibility, and the measure that is being proposed in the bill is a measure that other countries around the world have taken.

I will give the government credit. It has taken some action. It created an extractive sector counsellor office. As the name suggests, it was really counselling businesses. It had no power to do anything. In essence, it turned the responsibility for corporate behaviour over to the very corporations that were responsible for the behaviour. That is a bit of a conflict of interest. It has not stopped the government when it comes to rail or food safety, or any other sector of the economy that ought to be regulated by the government, but that is what it has done here.

This counsellor has no ability to enforce anything or to do anything. The office has not been able to achieve anything. In fact, the only counsellor that the government appointed resigned in frustration with one year to go before the end of her term. That was last October, and the position today remains vacant. This is how seriously the Conservative government treats corporate social responsibility in the extractive sector. It clearly does not.

This is an important issue for Canadians. More than 600,000 Canadians have supported this campaign since 2006. The campaign has found friends in the corporate network for social accountability in groups like Amnesty International, Development and Peace and Mining Watch Canada. It has also found support in people like: Tony Andrews, the former executive director for the Prospectors and Developers Association of Canada; Pierre Gratton, president and CEO of the Mining Association of Canada; and Reg Manhas, senior manager, Corporate Responsibility and Government Affairs, Talisman Energy Inc.

This is clearly long overdue. It is something Canadians want. It is something the government should finally achieve. The House should vote in favour of Bill C-584.

[François Choquette, NDP, Drummond, QC]

Mr. Speaker, I am very happy to rise in the House today to support the bill introduced by my colleague from La Pointe-de-l'Île, Bill C-584, An Act respecting the Corporate Social Responsibility Inherent in the Activities of Canadian Extractive Corporations in Developing Countries. I congratulate my colleague on the great work she does every day in the House of Commons. I am really proud of her.

I support this bill, as do hundreds of my constituents in Drummond who sent me letters asking me to support this bill to create an office of the ombudsman for the mining sector.

My partner supports it too, and that is saying something, because she is from Colombia. She has witnessed the disasters that some Canadian mining companies can cause in Latin American countries. My partner, Liliana, has urged me to support this bill, and I am proud to do so.

This initiative reflects NDP values: social justice, environmental protection and human rights. In short, this bill seeks to implement a recommendation by the national roundtables on corporate social responsibility and Canadian extractive industries dating back to 2007, as my colleagues said. Businesses and non-governmental organizations met to study the issue and they agreed on a resolution.

The main recommendation is to create an independent ombudsman's office that would act as a watchdog for the mining industry. We want to enforce corporate social responsibility standards and laws. That is very important.

Canada is in a unique position, since 75% of the world's mining companies are registered in Canada. Since we are a true haven for mining companies, our responsibility as Canadians is to ensure that these companies respect human rights, workers' rights and the environment as they do business around the world, whether in Latin America or in Africa. That is very important.

We cannot rely on self-regulation alone; we saw the results of such an approach in the XL Foods scandal and the Lac-Mégantic tragedy. We must take a serious approach that meets the needs of both extractive companies and the people who care about workers' rights and the environment.

The Conservatives claim to be masters of protecting mining companies, but they are completely out of touch because the mining companies themselves contributed to drafting this recommendation. In my humble opinion, the government must listen to this recommendation by the roundtables on corporate social responsibility. It is therefore imperative that an office of the ombudsman be created to ensure that the rights I mentioned are respected.

I will conclude and gladly give the floor to my colleague from La Pointe-de-l'Île, who can close on her bill.

Canada could be a world leader on this by establishing international standards requiring responsible business conduct.

The NDP wants to help developing countries protect their natural resources and ecosystem, as well as workers' rights. That is why we believe we must promote social justice, environmental protection and basic human rights abroad.

We want to create an ombudsman position, as the majority of the players are calling for. The ombudsman's mandate will be to investigate complaints, publish the results of his or her investigations and make recommendations to the government on additional legislative provisions and sanctions. That is what we need, and that is what the people of Drummond and all Canadians are asking for.

[Ève Péclet, NDP, La Pointe-de-l'Île, QC]

Mr. Speaker, as you know, it is always an honour for me to rise in the House to talk about corporate social responsibility. It is a topic that is very important to me.

Before I begin, I would like to thank all my colleagues in the House who took part in the debate. A special thanks goes to the organizations that have been working on corporate social responsibility for a very long time. They helped me in drafting my bill.

I have very little time for my response, five minutes, and I told myself that I would not respond to the Conservatives. Nonetheless, you know me, Mr. Speaker, and I would simply like to digress for a moment. My Conservative colleagues tell a good story, and I greatly appreciate their points of view. However, I have my own story to tell, the story of thousands of people around the world. They look at Canada with the hope that we will put an end to the abuse they are suffering once and for all and that we will help them to have better lives, safer lives in a healthy environment, but above all lives in which their fundamental rights are not violated.

I do not expect the government to acknowledge the facts—which have been acknowledged by this Parliament and the United Nations—but I can say that a number of reports recognize that abuses have been committed.

Some years ago, the problem of the social responsibility of Canadian mining companies in developing countries was not a hot topic, far from it. Despite the negative repercussions felt in many communities around the world, it has taken some time for the impact that these companies are having on human rights to come to light. I would like to give a little background on this.

In 2005, the Standing Committee on Foreign Affairs and International Trade tabled a report in Parliament recognizing what a negative impact the activities of Canadian mining companies were having on local populations, especially vulnerable populations in developing countries. The report recommended that the Canadian government eliminate the voluntary approach, and called for stricter policies on corporate social responsibility.

In 2006, as soon as the Conservative government was elected, it said that in response to that report it would hold a series of national round tables on corporate social responsibility. NGOs, industry stakeholders and civil society took part in these consultations and adopted a report. It was that report that led to this bill. It recommended creating an ombudsman position.

What did the Conservatives decide to do? They decided to use voluntary measures, exactly what the report—which was adopted by Parliament—said not to do. Unfortunately, since the office of the ethics counsellor was created in 2006, not a single case brought before the office has been followed up on. Why? Because the companies have refused to take part in the dialogue. The Conservative members can talk about their approach involving mediation and dialogue all they want; it did not work. At this very moment, people, human beings, are being abused by companies that are violating their basic rights.

Self-regulation and voluntary measures do not work. Let us finally give a voice to these hundreds of thousands of people who unfortunately have none and are living in a nightmare. I beg the government to take action. After all, it did accept and adopt that report. It accepted the main recommendation, to create an ombudsman position. The Mining Association of Canada signed the report. Everyone agrees that an ombudsman position needs to be created. The hundreds of thousands of people who are in situations in which their basic rights are being abused and violated have this right.

[The Acting Speaker, Conservative, Barry Devolin]

The question is on the motion. Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

No.

[The Acting Speaker, Conservative, Barry Devolin]

All those in favour of the motion will please say yea.

[Some hon. members]

Yea.

[The Acting Speaker, Conservative, Barry Devolin]

All those opposed will please say nay.

[Some hon. members]

Nay.

[The Acting Speaker, Conservative, Barry Devolin]

In my opinion, the yeas have it.

And five or more members having risen:

Pursuant to Standing Order 93, the recorded division stands deferred until Wednesday, October 1, 2014, immediately before the time provided for private members' business.