Foreign Affairs Committee on Oct. 27th, 2009

[The Chair, Conservative, Kevin Sorenson]

Ms. Lalonde, you have two minutes.

[Francine Lalonde, Bloc, La Pointe-de-l'Île, QC]

Thank you for being here and thank you for your testimony and for everything you're doing to help turn this dramatic situation around. From what we've heard and read, because they need to earn money, workers are often forced to work in conditions that are extremely difficult, distressing and harmful for them.

You said in various ways that you had hoped the proposed ombudsman would be the best way to take serious action. However, there's no ombudsman, for the reasons of which we're aware. What do you see in the bill that could help turn these dramatic situations around?

[The Chair, Conservative, Kevin Sorenson]

You have one minute.

[Alex Neve]

I'll take 30 seconds.

I think the requirement that there be new Canadian standards that explicitly incorporate Canada's international human rights obligations is absolutely key. It's missing in the current strategy. Yes, of course Bill C-300 doesn't propose the creation of the ombudsman or the tripartite compliance committee, which the round table process had. But the powers given in Bill C-300 to ministers to ensure that there will be proper investigation of allegations of a failure to conform to those standards, leading to public findings, are absolutely essential, as are repercussions and implications with respect to eligibility for various forms of government assistance.

[The Chair, Conservative, Kevin Sorenson]

I'm going to have to leave it at that. We're out of time here by a minute.

We'll go to Mr. Abbott.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Okay. I'm going to take the first minute of my seven minutes to comment on a statement made by my friend Mr. McKay. He said that this person he was speaking with got bullet holes in him courtesy of a Canadian mining company. That was exceptionally inflammatory, totally unnecessary, and irresponsible, in my judgment. We don't have any idea what occurred. We have no idea who shot the bullets or what the background was. I would have expected a higher standard from a member of the Privy Council.

With regard to the testimony, I'm really interested in Mr. Neve's characterization of this bill and the criticism of the bill as irrelevant. I wonder, Mr. Neve, if you could tell us how you think the Sudanese have made out now that there has been a switch from a Canadian company to a Chinese company. Do you think they're actually better off ?

[Alex Neve]

I'll be honest with you. Amnesty International had not called on Talisman to leave Sudan. We didn't say that they should stay; we didn't call on them to leave. We certainly were pressing them to adopt stronger human rights policies in the way they were operating in Sudan and to use the opportunity of being in the country to better promote human rights reform within the Sudanese government.

We agree with you, therefore, that in many respects it's a setback. It has been difficult to maintain and exert pressure on the Sudanese government with respect to the operations in the oil fields. But I don't think that means that Bill C-300 is a flawed approach. Bill C-300 isn't calling for Canadian companies to leave countries; Bill C-300 is calling on companies, requiring companies, to live up to human rights obligations. I think that if Talisman Energy had had those at the centre of their operations back in the mid- to late 1990s as they were moving into Sudan, they would have moved in a very different way. They would have had different policies and programs in place and would have been able to make a much more positive impact early on. Probably a lot of the controversy that later erupted, including problems they ultimately had with their own share prices because of that controversy, would have been, if not avoided, at least minimized. And they may not have been required to leave in the end.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

You would agree that the petroleum extraction is ongoing, whether it's by a Canadian company or a Chinese company.

I'll go to Mr. Casey, who mentioned the amount of investment that is currently on the Toronto Stock Exchange. It represents a very significant part of our Canadian economy. Would you be able to give us a best guess of the percentage that are irresponsible companies. What percentage represents the wealth of the irresponsible companies--50%, 60%, 40%? Or are we talking about a very, very few on the Toronto Stock Exchange?

[Michael Casey]

I'm not able to give you a precise figure. What our information is based on is an alarming number of cases in different countries in which we work. A number of our partners in communities affected by mines have brought to our attention that this is a concern in their communities. We have examples in every major region in which we work. The fact that Canada has a major presence in this sector--I mean, we're the biggest player on the street--naturally reflects badly on Canada and on Canadian companies.

We are working primarily from presentations by our partners who are involved in the communities affected by this. They have brought their concerns about the activities of Canadian mining companies in these communities to our attention as something they feel the Canadian public should be made aware of.

I can't give you a precise global figure on that or on what the amount of investment is. But we do have numerous documented cases of this from our partners.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

Don't you think that's rather important? I mean, let's take as an example.... I was very pleased to see recently, as I'm sure most of us were, that there had finally been an agreement between a Canadian mining company in Mongolia and the Government of Mongolia respecting issues regarding royalties and that kind of thing so that the company should go ahead. One of the few other companies in the world that would be big enough to be able to handle that particular extraction in Mongolia would be, say, a firm like Rio Tinto out of Australia, who will not have to comply with Bill C-300.

Going to Mr. Neve's point, if this were to proceed, there would likely be a substantial difference in the availability of financing to a Canadian company, as well as other restrictions that a firm like Rio Tinto, because of their jurisdiction, would not have. Therefore, I postulate that a Canadian company would not have been able to enter into this kind of gigantic mining project that they're talking about in Mongolia, and for Mr. Neve to turn around and say that's irrelevant I find really quite cavalier.

[The Chair, Conservative, Kevin Sorenson]

Very quickly. Again, we're at that one-minute mark. I think we'd better start with Mr. Casey first.

[Michael Casey]

With respect, I don't fully agree with that position because I don't necessarily see that this would be a competitive disadvantage for Canadian companies to have a higher standard of compliance. We tend to be in agreement with what Mr. Neve was saying earlier, that this would probably be an advantage because, if you've noticed, over the past several years almost all of the major mining companies, Canadian and others, have become very interested in this whole idea of corporate social responsibility. Many of them have created departments of corporate social responsibility that weren't there before. There's a higher level of awareness of environmental standards, and we have to admit that it's perhaps because of the increased scrutiny that has come on these companies to behave in that manner. This is good. It hasn't damaged Canada's competitive position or Canadian mining's competitive position.

[Jim Abbott, Conservative, Kootenay—Columbia, BC]

You don't know--

[The Chair, Conservative, Kevin Sorenson]

Mr. Abbott, you're out of time.

Mr. Dewar, please.

[Paul Dewar, NDP, Ottawa Centre, ON]

Thank you, Chair.

Thank you to our guests for their presentation today and for lending a voice to human rights, both here in Canada and abroad. I applaud the work they've both done, not only in their interventions here but in connecting with Canadians about the importance that we as a country demonstrate in walking the walk. We are the country of Mr. Humphrey's UN Declaration of Human Rights, which everyone around this table is proud of and, as Canadians, we should all be proud of. But it matters little if we don't actually get behind those words and do something.

One of the things that have disturbed me is the lack of coherence when it comes to human rights protection. I say “coherence” because I'm not going to get into the invectives and the cleavages that might be attractive in this debate. I'll give you the example of the Congo, from last spring.

We have 75% of the population living on a dollar a day. We have Canada's reach, through its mining intervention, responsible for about $300 billion in assets. We have people making money off this, in other words, and that's what companies do. No one's going to challenge that thesis. So when you look at these equations, a dollar a day--and by the way, the amount of money that the Congolese government receives from mining is about 60% or 70% of their budget. Yet when you look at the revenues they derive, it's about 5% of what comes out of the mining industry, so 95% goes, I guess, for operations, but probably a little bit to profit.

I think what people are looking for is some coherence. What is our responsibility? I see Bill C-300, as many of us would like to see, doing a little more. The tripartite approach is something that we would like to see, but Mr. McKay can't do that because it's a private member's bill.

So I hear from those who say, well, the voluntary approach is what we're doing and that's okay--and we're probably going to hear that from the EDC. Then I see the results of what I just laid out, a disproportionate redistribution of wealth but also the outcomes. And I won't get into that. People can read it for themselves, and I just hope that they get into it.

I'm not giving a speech; I'm laying some facts out, Mr. Goldring. I think it's a matter of people understanding that we do have a responsibility here.

I'll start with Mr. Neve. Do you see whether there is any other way, other than legislation, to ensure that human rights are actually going to happen? Do you know of any other jurisdiction or any attempt through voluntary methods to ensure that human rights are protected, and if so, where?

[The Chair, Conservative, Kevin Sorenson]

Thank you. We have about three minutes left.

Go ahead.

[Alex Neve]

There's nothing wrong with voluntary approaches in and of themselves. What we say is that voluntary approaches are never enough, and that's with respect to any human rights front, be it the human rights responsibilities of governments, of individuals, or of companies. We do--and this is from fifty years of human rights research--always come to the conclusion that ultimately you need some sense of obligation and enforcement.

Certainly all sorts of ways in which to encourage voluntary efforts to go further and do more are welcome. Education, training--all of those things are a vital part of it as well, but there's always a necessary role for legislation.

[Paul Dewar, NDP, Ottawa Centre, ON]

In other words, at the end of the day you need to have some form of administrative approach--in other words, sanctions--if need be, to ensure that those human rights are protected.

[Alex Neve]

I think standards are necessary for two reasons. Number one, they create a consistent set of expectations for all players. Whether it's a small mom-and-pop mining company that's moving in or a large multi-billion-dollar company, they all have the same expectations as to the minimal human rights obligations they must live up to. The second one is that having clear standards sets the ground for meaningful enforcement. Without clear standards, it's impossible to enforce.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Casey.

[The Chair, Conservative, Kevin Sorenson]

I think you have about a minute.

[Michael Casey]

I'll be very brief.

We fully support the comments of Mr. Neve on this. There has been a disappointing lack of evidence that voluntary compliance works. We feel it is necessary that there be more teeth put into compliance mechanisms and enforcement, which we feel is the necessity for Bill C-300 to go beyond the recommendations that were in the round table's report.

[Paul Dewar, NDP, Ottawa Centre, ON]

Thank you.

[The Chair, Conservative, Kevin Sorenson]

Thank you very much, Mr. Casey.

Mr. Neve, thank you for your testimony and for answering the questions we've had today.

We are going to call on our next witness to come to the table, so we'll suspend for a moment. Thank you again for your testimony.

[The Chair, Conservative, Kevin Sorenson]

Thank you, committee.

In the second portion of our meeting today, we're going to continue in our study of Bill C-300.

We have appearing, from Export Development Canada, Jim McArdle, the senior vice-president, legal services and secretary. Again, you were here for the opening hour. We'll give you an opportunity for opening comments, and then we'll move into the first round of questioning.

Welcome, Mr. McArdle. We look forward to what you have to say.