Foreign Affairs Committee on April 28th, 2014

[Peter Goldring, Conservative, Edmonton East, AB]

Thank you very much.

Thank you for being here today.

In my previous life I was involved in fire safety inspections as part of my company's business and was literally covering thousands of buildings, many of the large retail grocery stores, superstores, and what have you, for fire sprinkler suppression systems, extinguishers, etc.

It wasn't possible to have that many contracts out until 1985. They had to legislate it because we were going through a period of time when people simply didn't inspect these systems on any regular basis. They only found that the systems didn't work when people pulled a pull-station and it didn't work at a time when they probably needed it.

We know that this happens not only Bangladesh, because there was a shopping mall that collapsed here in Ontario two years ago, I think it was, for structural reasons. They didn't do a good structural examination there either. So it's unfortunate that we have to learn how to do better under fire conditions.

This arrangement that you have, I take it, is with the accord. Does that give you satisfactory reporting, device by device, location by location, a complete building audit in some detail? Is that transmitted to you, or do you have access to those records when you're negotiating a large manufacturing contract with them? Do you ever have those double checked for accuracy?

[Bob Chant]

Well, it will and does, but to a very limited degree at this point, because only a limited number of factories have been inspected. But if you go on the website of the accord, there is a list currently of a relatively small number of reports of problematic inspections that have been done. So you can see where there are issues with some of the factories. We welcome this very much.

I believe it was last May, for those of you who were here, that I reflected on my personal perspective on the challenge or part of the challenge. I said that the Government of Bangladesh could not do what was required to get all of these work places up to scratch, to what they should be. It was another of the reasons that we decided to sign the accord, because we believe that industry collectively needs to step up to the plate in this regard. So the accord is the way we, Loblaw, are taking action in that direction.

The hope is that in a number of years many, if not all, of the factories in use will have been inspected, improvement plans been put into place, sprinkler systems installed, and the workers continued to be employed, and that we'll be talking about a much better place. As well, this model can be used in other developing markets to ensure that workers are safe when they go to work.

[Peter Goldring, Conservative, Edmonton East, AB]

I know that when I would source materials for private labelling or my own distribution in western Canada, I would certainly visit the suppliers. It was not only to assure yourself that they would able to capably supply what you wanted and supply it correctly, so that it would work and be a good product, but also so that you would have an opportunity to walk the floor of the shops to see what kind of circumstances they have there. I'm probably not leaning that heavily on doing a personal safety inspection, but all of that is relative. When you walk into a factory, you get the initial impression of the dynamics there.

When I visited Gildan's factory in Haiti, I got a very good feeling that it was a professional operation, although that's their own brick and mortar.

If you are sending your people in to do these inspections, do you have risk assessors and corporate safety people too for your projects here, for your own buildings?

[Bob Chant]

We do here.

We did not have our own people on the ground in the region last April. We do now. We're starting to build that team. We have a handful of people who are going to be working in the region to do just that. It's a group effort, I guess. We have our own people on the ground. We will be continuing to do our own audits and inspections. They will be third-party contracted, but with the cooperation and involvement of our people on the ground there.

On top of that, we will have the accord work that's being done and the alliance work that's being done, and on top of that, the work that the Bangladesh University is doing in cooperation with the Government of Bangladesh, with the support of the Department of Foreign Affairs Canada and three or four other countries around the world.

One of the challenges, to be honest with you, is that we are probably going to have too many audits and inspections going on all at the same time, but I think that's a good problem to have.

It's my hope, and Diane and I have talked about this many times, that out of this we can find a plausible and practical model for accurate and effective inspections that minimizes the amount of audit fatigue that these countries go through. That's an important consideration as well.

[The Chair, Conservative, Dean Allison]

Thank you very much.

Thanks, Peter.

We're going to move over to Mr. Dewar.

You have five minutes, sir.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Chant, I just want to follow up with you.

I recall last year that we just touched on it. You identified the issue of capacity and inspectors, and we've talked a bit about that issue this afternoon. Clearly there's a role for government here, and part of our development policy would be to help with that capacity.

What is your estimate about the kinds of numbers we're looking at now? You have your own people. From your experience, and certainly with the accord, where are we at?

[Bob Chant]

Well, we're far better off than we were 10 or 11 months ago. The numbers I've seen for the proposed number of inspectors needed range from 200 to 800. So somewhere in-between would likely be the right number. There are so many other variables—and here I think it was Peter who mentioned the 500 acres of land set aside outside of Dhaka—

[Peter MacArthur]

That's right.

[Bob Chant]

—that if a number of factories moved, in this case, to that new location with new facilities, and had all been inspected, then the number of inspectors required to do the rest of the work would go down. Honestly, I think it's a bit of a mug's game for me to even estimate.

[Paul Dewar, NDP, Ottawa Centre, ON]

Obviously it's something that we can work on with the government to do.

[Bob Chant]

There's no question, yes.

[Paul Dewar, NDP, Ottawa Centre, ON]

It's a good thing for us to do.

[Bob Chant]

It's a good thing for us to do.

I've had conversations with people in the minister's office and the department, and there certainly seems to be receptivity to that.

[Paul Dewar, NDP, Ottawa Centre, ON]

Our minister.

[Bob Chant]

Yes.

[Paul Dewar, NDP, Ottawa Centre, ON]

Have you been back recently?

[Bob Chant]

I was there two months ago.

[Paul Dewar, NDP, Ottawa Centre, ON]

The reason I'm asking is that you're seeing some of these things first-hand. I do recall last year that you were quite candid about your personal reaction to what happened, and I think that's important. I think seeing is believing. Any time is the right time to do the right thing.

We applaud you to keep that up, and to keep visiting and keep on top of it. As soon as we turn the other way, I find it's easy to let things get away on us. I just wanted to say that personally.

[Bob Chant]

Thank you.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Smith, one of the policy issues I think you touched on was procurement, government procurement in particular to encourage behaviour.

What has been your experience on that, and why might this be something that our government could look at?

[Tom Smith]

I think it's a huge almost culture shift in the way that governments and civil society organizations can approach fair trade today. I think there are recent and stunning examples. We accredit two significant programs in Canada: the fair trade towns and cities program, and the fair trade campus program. For the most part, they're engaged and led by young champions in both of those types of organizations.

I can give you the example of the university of McGill, which was recently accredited as a fair trade university. Their administration, with leadership from their auxiliary services department, really took the lead and have changed their procurement practices so that coffee, tea, sugar, and cocoa products at McGill are bought from fair trade vendors and are fair trade products. So that's a significant change.

A really significant example is Simon Fraser University in British Columbia, where their students came to the auxiliary services department—the administration—and said they really wanted a Starbucks café on their campus, and Starbucks is a partner in fair trade. They went to Starbucks, and the first café that Starbucks opened on the Simon Fraser University campus is totally fair trade. It's a great example and was so successful that they're now getting ready to open a second café.

From a local standpoint, I hope you heard the announcement two weeks ago that the University of Ottawa has taken steps to become a fair trade campus. They are currently working with Fairtrade Canada to talk about fair trade suppliers that are engaged in the fair trade arena and can provide good supply chain solutions.

The other thing I would stress to the committee is that this isn't about forcing someone to change their procurement suppliers. This isn't about punishing suppliers but the university of McGill telling their suppliers to go find fair trade products. They don't want to change the suppliers. They want to change their purchasing practices, and that's a substantial, important thing to get across.

So we've seen some significant changes. For Canada I think it's important that the Government of Canada has significant purchasing power, from the various institutions under the control of government, and when you think about.... Well, I'll give you an example. Just back on your stand, you are promoting fair trade coffee, but you also have Lantic sugar. Lantic sugar just became the first major Canadian initiative on sugar products, and you will be selling, buying, or sharing fair trade sugar—

[Paul Dewar, NDP, Ottawa Centre, ON]

I just kicked sugar.

[Tom Smith]

—but that's an immediate thing. So to answer your question, Mr. Dewar, I think the Government of Canada can take a lead, mandate, and encourage the procurement departments right across the country, because fair trade products are available in over 70 product categories and right now in Canada there are about 27,000 different products.

[Paul Dewar, NDP, Ottawa Centre, ON]

And you can buy them at Mr. Chant's store too.

[Tom Smith]

Sorry?