Good morning, everyone. My name is Peter Sinclair. I'm the senior director for corporate social responsibility for Barrick Gold. Just to give you a little bit about my background, I've spent the last 20 years working with communities in the developing world, most recently with the mining industry, but prior to that I worked for 15 years for international development and humanitarian aid NGOs.
I lived and worked in Africa for over seven years, in Rwanda, Ghana, Swaziland, and the Congo, and I've worked as a consultant with the World Bank, European Union, and NGOs such as World Vision.
Let me just start by reiterating that we agree with the objectives in the bill. No one would argue that Canadian companies should not apply the highest CSR standards, wherever they operate. However, we do not believe this bill will achieve that goal. It also has the potential to seriously harm the Canadian mining industry and the countries in which we invest.
As Mac indicated, I'd like to focus on just one practical problem with the bill: the guidelines the minister would use to assess the culpability of Canadian companies.
As you know, the intent is for the guidelines to be drafted within 12 months after the bill has been passed. The guidelines would incorporate publications by the IFC's voluntary principles on security and human rights, as well as unspecified international human rights standards.
At a previous hearing, we heard from Professor Janda, who clearly told the committee that these guidelines do not lend themselves easily to direct and literal incorporation into the bill. He believes, though, that this is just a drafting issue that can simply be worked through. However, anyone with a detailed knowledge of and experience with implementing the guidelines will know that it will require much more than artful drafting to transform the guidelines into hard and fast rules for the industry.
To use the analogy from a previous submission, from a legal perspective the difference between these publications and legally binding instruments is the same as that between a manual on safe driving and the Highway Traffic Act. The guidelines were designed for a particular purpose, to offer guidance to banks and companies to enhance their performance in the area of CSR. For this purpose, the guidelines are well suited, but they lack the clarity that legislation demands and cannot be shoehorned to further the legislative purposes of this bill. The proposed process fails to recognize that successful CSR policies and programs are context-specific and responsive to local conditions and priorities. This bill proposes a one-size-fits-all model that would have companies apply one set of rules in a thousand different situations.
Let me give you a practical example to help illustrate this. Community engagement is a key part of what we do as a mining company. There's an IFC guideline on community engagement that states, “The nature and frequency of community engagement will reflect the project's risk and adverse impacts on affected communities.”
A mining company does not engage with a community without taking on board its unique cultural, political, and social characteristics. This is a general principle of engagement and a critical part of best practice. No mining company today would argue against a well-tailored community engagement program, or they do so at their peril. However—and this is the key—while the principle of engagement is universal, the specifics are as varied as the communities in which we operate. To make a determination as to what is sufficient and appropriate requires a detailed understanding of the project and the local dynamics and a high degree of expertise in community engagement. This is not the type of determination that can be made by a minister's office.
Given how hard it would be to determine consistency with the guidelines, and without a fair, transparent, and well-resourced investigative process, even the most socially responsible companies could be exposed to unfair determinations. The consequence is clearly unintended but nevertheless real. Due to the additional risk posed by the bill, responsible companies may be deterred from investing in developing countries. This outcome would deprive developing countries of much-needed foreign investments and jobs.
Thanks very much for your attention. I'll now turn back to Mac, who will address the negative impacts this bill will have on any future financing for exploration and development projects.