Thank you, Chairman and standing committee members.
I'm Robert Blackburn, senior vice-president of SNC-Lavalin International, and I'm accompanied by my colleague, Jean-François Gascon, who is the leader of our project sustainability group and environment. We're going to jointly make a very brief presentation.
SNC-Lavalin is one of Canada's largest engineering construction groups. Our key sectors of activity are mines and metallurgy, chemicals and petroleum, power, and infrastructure construction, ownership, and management. In 2008 half of our revenues of $7.1 billion were for work outside Canada, of which, interestingly, only 3% came from the United States, and 13% came from Africa, which has traditionally been our principal geographic market outside Canada. We're currently working on every continent, with approximately 10,000 projects under way in 100 countries. We have an employee workforce of about 22,000 around the world.
I want to make six main points, after which Jean-François will brief you on his experience and observations in dealing with project sustainability issues in Africa and elsewhere.
First, we're sympathetic to the objectives of Bill C-300. However, we have serious reservations about the need for and proposed approach of the bill. Contrary to what seems to be an underlying assumption of the bill, Canadian mining and oil and gas companies generally have a very positive record and reputation internationally. The uncertainties created by the proposed bill would place their activities in jeopardy, and they would be at a severe disadvantage with their competitors in global markets.
Next, Bill C-300 would affect SNC-Lavalin, because although we're not a mining or oil and gas company, we provide services to Canadian and foreign clients in these sectors in developing countries. In addition, we sometimes take small equity stakes in clients' projects, thus aligning our interests with theirs. Our investment in Ambatovy in Madagascar is an example where we're following industry-leading Canadian Mining Association voluntary guidelines—very strict guidelines.
In his testimony, Jim McArdle of EDC—Export Development Canada, that is—referred to 139,000 Canadian jobs sustained in 2008 alone by EDC export support and investments in the extractive industries. Several thousand of these are SNC-Lavalin employees in Canada and around the world.
Thirdly, it is important that the rules affecting Canadian companies be comparable with those observed by competitors based in other countries. Any project that benefits from export credit financing, as well as any project financed by most large banks following the Equator Principles, must meet stringent rules for environmental and social assessment of projects, as set out in the OECD recommendation on common approaches to the environment. They must also observe ongoing requirements during implementation and operations phases as set out by the same OECD and World Bank guidelines. Not only does the project proponent have to meet these criteria, but the financing agency requires that the proponent issue regular progress reports explaining how the commitments are being met. The EDC typically conducts audits for performance as well.
Finally, the EDC and World Bank regimes require the disclosure of a considerable amount of information in the form of environmental and social impact assessment reports, and often ongoing progress reports. The way in which a Canadian mining or oil and gas company develops and implements a project receiving such financial backing is thus very transparent. The same cannot be said for companies from countries that do not adhere to the OECD common approaches to environmental and social policies, and we can think of some, in Sudan and elsewhere.
My fourth point is that complaints and sanctions proposed in the bill would pose significant threats to companies' reputations, since with or without substance, each complaint calls for some level of ministerial investigation. There seem to be no sanctions against frivolous or vexatious complaints that could conceivably be launched not only by individuals but even by disgruntled competitors. Many of the complaints that you may have heard in this committee or elsewhere in print are not only inherently unprovable but cannot reasonably be defended against. The launching of a ministerial investigation would harm a reputation, whatever the outcome. Furthermore, it is not clear what resources and host government cooperation would be necessary for such investigations. These countries do have their own laws, as has just been stated, which are usually very effective.
In any case, the process would seem to be a duplication of the recently announced federal CSR strategy, with a CSR counsellor and the national contact point for the OECD and MNE guidelines .
My fifth point is a comment: that in the past twenty or so years, considerable progress has been made in Canada to bring industry and NGOs closer together and away from the adversarial zero-sum game of old. Examples include the National Round Table on the Environment and the Economy, an EDC consultative process regarding its environmental review directive.
Ultimately, Bill C-300 may well do little good for the environment and local communities where projects are implemented in the third world. It will certainly not boost Canada's competitiveness.
Finally, I think that the burdens and uncertainty of the bill's approach to standards and international enforcement would militate against Canada's hope of expanding into new and fast-growing markets around the world. Our bottom line was well stated by Jim McArdle of EDC, when he said:
If this bill becomes law, we believe that our opportunities to be on the field would be severely limited. Instead, we as Canadian companies and EDC would be on the sidelines hoping that the other companies who remain in the market do the right thing from a CSR perspective.
Thanks for your attention. I'll now ask Jean-François Gascon to share his experience with you.