Thank you very much, Mr. Chair.
Thank you, members of the committee, for inviting us here to testify and to discuss Bill C-300.
The Canadian Council of Chief Executives represents the heads of large globally engaged enterprises in every sector of our economy. We have spoken clearly and often about the importance of good corporate citizenship at home and abroad, and I think it's fair to say that by any objective measure Canadian companies are among the most socially and environmentally responsible operating in developing countries worldwide.
Far from promoting more responsible behaviour by Canadian corporations operating internationally, we fear that Bill C-300 would result in Canadian corporations either choosing not to make beneficial investments in developing countries or losing business to corporations based elsewhere that will not have the same regard for environmental, safety, and human rights standards.
The council's main concerns follow.
The legislation is based on a flawed premise, since it assumes that Canadian companies are not to be trusted in their international operations.
As yet, there is no internationally recognized set of standards against which Canadian practices can be judged.
By suggesting that unilaterally determined Canadian standards should take precedence over the laws and regulations established by sovereign nations, Canada would be engaging in a form of extraterritoriality that it consistently has rejected when attempted by other countries.
On a more practical note, the mere threat of a withdrawal of export financing from Export Development Canada or a loss of access to investment from the Canada Pension Plan Investment Board could easily jeopardize projects in developing countries. We know of no other national legislation that would seek to discipline the international activities of its resident corporations in this manner, and thus competitors in other countries would have an unfair advantage over Canadian companies.
The bill purports to screen out vexatious or frivolous claims, and yet it provides no effective mechanism for doing so. Any person can request an investigation, regardless of whether they're personally affected, and without having to supply any credible evidence of inappropriate behaviour by the corporation in question.
The filing of a single complaint sets the process in motion, and the mere fact of an investigation, regardless of its eventual outcome, would likely prejudice the Canadian company. In a bidding situation, a competitor could easily arrange for a complaint to be launched and then lobby the foreign government to exclude the Canadian company from the whole bidding process, on this basis: “Look, they're even being investigated by their own government, so how can you possibly do business with them?”
Undertaking an investigation under the act likely would require the assistance of the government of the developing country, which may or may not be forthcoming. In any event, Canadian ministers responsible would not have ready access to the resources or detailed expertise they would need to easily determine the merits of a complaint. And all of this would lead to unacceptable delays and prejudice to the Canadian company.
Let me be clear on one point. We believe that Canadian companies should always operate in a transparent and ethical manner, both internationally and at home, and we fully support efforts to improve the governance practices of all companies operating in developing countries.
The federal government has been engaged with responsible Canadian companies for some time in an effort to develop sound corporate social responsibility standards and their practical implementation. We should allow these efforts to continue rather than short-circuit them through misguided legislation.
I think it's fair to say that for many years Canada has been seen as a centre of excellence in the mining industry, both in terms of a significant number of Canadian champions competing around the globe and with respect to our ability to provide world-class financing of mining ventures anywhere. In an era when national brand is increasingly important, this legislation is likely to tarnish our well-deserved reputation for good corporate citizenship in the extractive sector. It could also imperil the brand of many other Canadian companies operating in developing countries, beyond those in mining and oil and gas. Therefore, I urge members from all parties to vote against this bill.
Thank you, Mr. Chairman.