Foreign Affairs Committee on Nov. 19th, 2009

[The Chair, Conservative, Kevin Sorenson]

Thank you, Ms. Sorio.

Mr. Thomson, very quickly.

[Ian Thomson]

Thank you, Mr. Chair. My name is Ian Thomson. I coordinate our work on ecological justice and corporate accountability.

I think Connie has conveyed to you what motivates Canadian churches for their work in this area. It is a response to a call from the south that we hear repeatedly day in and day out from not only human rights organizations and community organizations but also from our church counterparts in the south--bishops from the Philippines, an interfaith commission from Tanzania. These are where the calls are originating for Canada to take responsibility, for action to happen here at home. They are doing what they can to bring about change within their own context, within their own countries.

But it's incumbent upon us. And this is where I think the bill that's before us today is a chance for Canada to rise to that challenge. Church leaders are speaking out on this issue. Churches participated in the national round tables on corporate social responsibility. This is one of the most pressing ethical questions Canada faces on the foreign policy agenda, and it's one of coherence.

Will we, on the one hand, be promoting human rights and trying to do peace building and addressing the problems in conflict zones, while on the other hand some other Canadian actors may be working at cross-purposes and may be receiving support from our own government in some of these activities? This is not to say that all industry players are problematic--far from it. And we've heard that in the testimony earlier today.

Bill C-300 has the full support of KAIROS and all of our members from eight Christian denominations, as Connie mentioned. The bill addresses some of the shortcomings in the CSR strategy, which was announced earlier this year. Actually, it was announced after Bill C-300 was tabled, I'll remind you.

But I think the two can work well together. If we look back to the standing committee report of 2005, there was an explicit call for using financial and diplomatic assistance from the Canadian government as an incentive, as a tool to drive corporate responsibility. Bill C-300 makes this possible by creating a linkage between performance and government assistance.

You'll also find support for the bill in the work of Professor John Ruggie, the UN special representative on human rights. He's a UN diplomat. And he was very diplomatic in his report to the Human Rights Council last year. You had to hunt hard to find a concrete recommendation directed at states.

He does identify export credit agencies as one area, as arms of the state that could actually help states fulfill their obligation to protect and promote human rights. He does say that export credit agencies should be requiring clients to do due diligence around human rights. And he goes on to say that in his informal discussions with several export credit agencies around the world, many said they were looking to their government overseers for specific authority to move in this area. Bill C-300 grants EDC that room.

Now, this isn't unprecedented terrain for parliamentarians. When an environmental review directive was added to the Export Development Act, EDC complied and developed an environmental review process, and it's in effect today. I think when Canadians look back on the standing committee report from 2005 and the deliberations of this committee over the past few months, they will draw parallels here with the introduction of the environmental standards, the environmental assessments that industry now takes as standard practice.

We are moving into a new field here, which is giving EDC, the Canada Pension Plan, and our foreign missions abroad an explicit mandate to build up their capacity and their policy in the area of human rights and social responsibility. This is, in effect, what the bill can achieve. That is why I would urge all members of this committee to support the bill, to bring about these changes, to find that target that the round table consensus brought us to, as a member of this committee alluded to earlier, which is not where the current CSR strategy that the government introduced earlier this year has brought us. I know it's new, but I think we know, looking at it, that it doesn't address the problems that were raised in the round tables. They will persist under this current strategy.

To hearken back to the national contact point, if there was consensus at the round tables, it was that the current mechanisms are not working and we need new mechanisms. There was consensus around that.

So I urge you to support the bill. I think it does introduce those new mechanisms that will lead us in the direction that Canada is inevitably headed, and can make Canadians proud that our export credit agency, our pension fund, and our embassies abroad are promoting responsible business practices everywhere in the world.

Thank you very much.

[The Chair, Conservative, Kevin Sorenson]

Thank you, Mr. Thomson.

Mr. Pearson and Mr. Rae.

[Glen Pearson, Liberal, London North Centre, ON]

Thank you, Chair.

Thank you for coming.

Mr. Hunt, I was born and raised in Calgary, Alberta. My father and brother were both in the extraction industry. On the other hand, my life has been spent on the ground in different third world areas, so I'm really wrestling with what's happening as this debate is going forward.

It seems to me that the more we discuss things, corporations are being presented as dragons that are going to break all sorts of laws, and NGOs are being presented in local indigenous communities as groups that would use any excuse imaginable to try to cause grief for companies. So the words “frivolous” and “vexatious” continue to come up.

I have a practical question to ask you, because I know that you know both sides of the industry.

Earlier, Mr. Beatty from the Chamber of Commerce said that what will happen to the Canadian extraction industry overseas...if this bill is passed, it will provide a competitive advantage to our other international competitors. He said that work could be done amongst NGOs in the various regions where the extraction industry is, and they could be working with NGOs on the ground to try to bring forward these frivolous and vexatious complaints. None of us have any interest in seeing that, if they're not justified, but I would like to ask you, do you think that is a real possibility? Also, if Bill C-300 were passed, would it speak to that? Would Bill C-300 have that effect?

[Stephen Hunt]

I think Bill C-300 would. It would be my opinion, but it's pretty light. It doesn't go far enough.

I do think that Canadian mining companies, first off, export wonderful technology. We know how to mine. We really do. We've got it together. And our expertise and developing mining equipment and mining technologies and processes are probably number one in the world. We have a huge mining industry here. We're really proud of it, and we're really proud of the work we do.

One of the things we learned over the years, as Canadian miners, is that you have to really watch Canadian mining companies. If you let them get away, they hurt people; they do bad things. Not all of them, but there's a bad reputation. We had Elliot Lake, we had Westray, barium in Quebec, asbestos throughout, lead in Trail. We had the biggest penalty assessment in British Columbia history against Cominco for exposing workers.

We're the most regulated industry in Canada when it comes to protecting workers and the environment. We could really lead. The Canadian flag could go way up on the flagpole, to say if you want to invest in a foreign company, you should go to a Canadian mining company, because not only do they have the technology, but they also have the will and the ability to protect workers, the environment, and communities around those mines. That's where we could do it. That's where I think the mining companies would shine. The very responsible ones will do that anyway, and there are many of them.

I think it would really take care of some of the juniors that fall off the edge sometimes. I said this earlier: sometimes it's just economic heroin. If you go into one of these countries, or a community in Canada, and say you're going to open up a mine and you're going to create a whole lot of jobs that will be big paying jobs, people will bend over backwards to accommodate that industry. And sometimes we leave some of the most important things behind. We clearly have the technology to extract, but the important parts that come with the people are oftentimes missed.

[Glen Pearson, Liberal, London North Centre, ON]

Thank you, Mr. Hunt.

[The Chair, Conservative, Kevin Sorenson]

Mr. Rae.

[Bob Rae, Liberal, Toronto Centre, ON]

I have to declare that I started my early days as a young lawyer working for the United Steelworkers, and I'm very proud to continue that association throughout my life.

I'd like to ask all the witnesses, really... This does go a bit beyond the consensus with respect to the round tables. I think we're all struggling with whether there is a way of better expressing that consensus in this bill, rather than the exact wording that's in the bill now. Would you like to comment on that?

You have to admit that in the bill we have gone a little bit beyond where the consensus was. The ombudsman idea that's in the round table, the dispute resolution that's in the round table, that wording is not found exactly in this bill. How do we get it in? How do we get a process into this bill that actually reflects what the round table was talking about?

Are you following me at all, Mr. Thomson, Mr. Hunt or Ms. Sorio?

[Ian Thomson]

I think it is unfortunate that, when a strategy was announced by the government, the key elements from that consensus around the process that was mapped out in the round tables were clearly missing.

[Bob Rae, Liberal, Toronto Centre, ON]

That's right.

[Ian Thomson]

It's almost to the point where what the government is doing is actually better done by many of the industry associations that participated in the round tables. In some ways I feel that it is a bit of an abdication of the government's rightful role, to create a centre of excellence, which is now going to be housed in an industry association anyhow, to have a counsellor to advise companies. These are things that often better left to the industry itself.

What we really want to see Bill C-300 introduce is a fair process whereby Export Development Canada, CPP, and the foreign service can, in a consistent manner, apply human rights standards and corporate social responsibility expectations when they offer assistance to our companies. I think the strength of the bill, in having a broad and consistent across-the-board approach, is just that: Canadian companies, and other companies, quite frankly, that are seeking assistance from the Canadian government will know what they're dealing with, and it won't be left to different policies or even conflicting policies with different state agencies. The strength of the bill is really in having a broad approach, a consistent approach, across these different jurisdictions.

If we look at environmental policy, clearly the industry has come a long way on the environmental front, and it has been in part not just by leaving things strictly to voluntary implementation. It has been about having consequences and actually attaching some of those environmental expectations to the public dollars that companies need to pursue projects. That is an important lever that the government is not currently using and that Bill C-300 allows us an opportunity to leverage.

[The Chair, Conservative, Kevin Sorenson]

Thank you, Mr. Thomson.

Monsieur Cardin, vous avez sept minutes.

[Serge Cardin, Bloc, Sherbrooke, QC]

Thank you, Mr. Chair.

Thank you, gentlemen, madam, for being here.

Mr. Beatty, CEO of the Canadian Chamber of Commerce, was telling us that those who support Bill C-300 do so on the basis of a specific ideology. In answering my colleague, he stated that this ideology is to be opposed to mining.

Mr. Hunt, you are a perfect example of someone who supports Bill C-300 while at the same time supporting the mining industry. In fact, you only want the workers of this industry to be protected and to be safe, to be able to live with dignity from their work and to respect the environment. That is what you said. Furthermore, you have some international experience. You have seen various countries. You have seen many mining companies operate in various regions under varying conditions.

We have been told that close to 60% of all mining companies are registered in Canada, which seems rather strange.

Would this be an indication that the situation in the other countries that have mining companies, as far as social responsibility is concerned... How does the social responsibility of Canada towards mining companies compare with that of other countries? Is that why so many companies want to register in Canada, to be able to operate mines all over the world?

[Stephen Hunt]

I think clearly Canadian mining companies lead the world--I said that earlier--and they lead it in the technology and methodology for extracting resources. The reason they go to developing countries is because developing countries don't have the capital to develop the resource, and unlike in manufacturing or other industries in Canada, you can't take an ore body, a copper deposit, and move it to China or India and re-establish production. You have to go to where the ore bodies are. They again have the expertise to develop, and obviously the capital and the backing to do it. So they could raise funds on the Vancouver Stock Exchange or the Toronto Stock Exchange and promote these. Usually the juniors go down and find the deposits and the seniors or the majors go down and develop them. That's just the process we've developed in the Canadian mining industry.

There's no magic to it; they go where the resources are. There are massive amounts of money. If you think of it this way, why do Canadian mining companies work in other countries? It's simple. The resource is extracted on whatever economy that country has. So if it's a Chilean peso, it's coming out in pesos and being sold on the world market in U.S. dollars--the end. So it's a really easy advantage for companies to look at that.

In some respects, a Canadian mining company... I know when I go to bargaining tables in Canada and sit across the table from Canadian mining companies, they always tell me that we're in direct competition with mines in South America. Oftentimes they own them, so they're competing with themselves. It's a little shell game for them.

[Serge Cardin, Bloc, Sherbrooke, QC]

I seem to have been misunderstood. I'm interested in the social behavior of Canadian mining companies compared to companies of other countries.

Is there in those other countries some legislation regulating their mining companies that operate abroad? Do those countries have more restrictive legislation than Canada to regulate socially responsible behavior?

[Stephen Hunt]

We have a labour dispute on right now at Vale Inco in Sudbury and Voisey's Bay. It's a Brazilian mining company and they don't seem to adopt any Brazilian standards when they operate in Canada. In fact, they're trying to drive us down. If they have a standard for Brazil, we don't see it.

[Serge Cardin, Bloc, Sherbrooke, QC]

No, that does not really answer my question. This is a matter of competitiveness. If we pass a piece on legislation regulating socially responsible behavior of Canadian mining companies overseas, this might impact their competitiveness and make them lose some of their markets.

At the same time, some countries have substandard legislation relating to human rights and the environment, and mining companies are more interested in operating there because this makes their life easier. In the context of globalization, we know that companies will try to go first where costs are lower, resources are available, and there is less regulation of labor conditions, the environment and so on. Therefore, a piece of legislation regulating Canadian mining companies would be beneficial to local communities, probably against their managers who would be tempted to be more flexible because of major investments in that country.

I strongly believe that we have this responsibility towards other countries. In a world of international trade and globalisation, when we sign bilateral free-trade agreements, it is not as if we are signing multilateral agreements where standards can be set for everyone. There are dangers in that sense.

Let me ask Mrs. Sorio if she knows what the situation is for mining companies in Colombia, for example.

[The Chair, Conservative, Kevin Sorenson]

Thank you, Mr. Cardin.

Ms. Sorio.

[Connie Sorio]

We have a KAIROS partnership coordinator for Latin America, and Colombia is one of our priority countries with regard to human rights and also resource extraction.

I'm not very familiar with our work in Colombia in that area, but I know that just two weeks ago partners from Latin America, from Honduras and Guatemala, were here in Canada and met with some members of Parliament expressing their support for Bill C-300.

If I can just respond to previous questions, the partners overseas look at Canadian mining companies as leading the industry, and the fact that the Canadian government has this opening for organizations, industry, and NGOs to present and have their input on a particular bill shows our democratic process. Partners very much appreciate that because in their countries they don't have that space.

So when we talk about Canadian mining companies impacting communities, they want to come to us and say, your company is doing this--and it's eroding Canada's reputation, from our perspective. So passing legislation that would make companies more responsible would increase Canada's reputation overseas. This is not to say that other mining companies from other countries--for example, Australia--are not being lobbied because of their conduct and behaviour.

[The Chair, Conservative, Kevin Sorenson]

Thank you, Ms. Sorio.

We'll move to Mr. Abbott or Mr. Lunney.

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

I'll start, and then Mr. Lunney will follow.

Mr. Hunt, just to establish my own personal credibility with you, as you did with us this morning, I understand exactly what you're talking about with respect to Westray. I visited there shortly after and was pleased to be involved with Alexa McDonough and what turned out to be an all-party movement to get the legislation through.

I have had a very productive relationship with your union in my constituency, and where we have differences of opinion, we manage to find areas of commonality. So I'm very supportive of what you're doing.

That said, we are talking about Bill C-300. If I understand correctly, the basic tone of what we've heard from you is that you see Bill C-300 as being a way to establish Canadian labour standards or even bargaining practices in other countries. Would that be a fair characterization?

[Stephen Hunt]

No. We know you can't. For example, you can't compare wages in Peru to those in Canada. It would really skew the economy of Peru. You'd have miners making more than doctors, for example, so we don't advocate that. But we do say at least minimum health and safety standards and environmental standards. The recommendations here are for very minimal standards. It's World Bank standards, so they're not even the standards of the ILO, for example, as a base.

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

So would I be more accurate to say you see Bill C-300 as a way of establishing certain labour standards in other countries through Canadian legislation?

[Stephen Hunt]

No, I don't think we'd be looking for Canadian legislation.

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

But this is Bill C-300. Your idea is that with the Canadian legislation, Bill C-300, should it pass, your union would see that as being a way of establishing the kinds of standards you're talking about in other countries.