International Trade Committee on Feb. 9th, 2023

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

Thank you, Madam Chair.

I want to say thank you to all the participants for their testimony today.

Take a look at what we're doing. We're studying Canadian mining companies abroad and what they are doing as it relates to the environment, labour and a number of practices. We've heard testimony already that there are some pretty bad things happening out there.

What came to mind for me—I'm from Sault Ste. Marie in northern Ontario—is that we have a thing called the Ring of Fire in northern Ontario, which everyone, I think, in Canada knows about. It's like an unlimited potential with critical minerals. A number of companies have been interested in this and gone through some processes, the most recent of which was Noront.

Noront has just been purchased by Wyloo, from Australia. They're going through the processes, and rightly so. They have to do federal and provincial environmental assessments. They have to engage with the indigenous communities around the Ring of Fire and a lot of the communities that would feed into it as well, including Sault Ste. Marie. There are a number of stringent requirements that a Canadian mine has to and ought to meet to begin operations, including labour practices and such.

When they deal with the indigenous communities, they start talking about community benefits and how those indigenous communities can get work and have other opportunities to build their skills through skill development and whatnot.

About 50% of all mining companies are headquartered here in Canada. Then we take a look at what Canadian companies are doing abroad, and they're guided by the towards sustainable mining standard of the Mining Association of Canada. It's a program that is mandatory for the companies that belong to it here in Canada, but it is voluntary when they go abroad.

Madam Chair, through you to our presenters, could they please comment on that program, which the trade commission services here and abroad try to promote with these mining companies? What are the advantages and disadvantages of requiring all Canadian mining firms operating abroad to meet these standards?

I'll start with the United Steelworkers, and then we can go around the floor. If you can, keep your comments brief so that everyone can get a chance.

I'll start with Meg first.

[Meg Gingrich]

Thank you.

Regarding the towards sustainable mining initiative, it is important to have something that comes from outside of industry actors, which is why we support stricter and more comprehensive due diligence legislation. Voluntary standards can be useful. We work with IRMA and other responsible mining initiatives, but they wouldn't be entirely dominated by industry, and they would include particular labour rights and so on.

In terms of our position, we think that actually having legislated due diligence is the best way of ensuring that mining companies act as they should abroad, and that there's recourse for those affected by Canadian mining companies and their subsidiaries. It ensures that even if they have good intentions, even if the market is putting pressure on companies, or even if there are increasingly voluntary standards to adhere to.... All of that can be okay, but it's often not enough. That's why we press so hard for the due diligence legislation and actual requirements, to ensure that environmental, human and labour rights are respected and that there's recourse for people in communities around the world.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

Thank you, Meg.

I guess I'll go to the room—

[The Chair, Liberal, Judy Sgro]

You have 13 seconds remaining.

[Terry Sheehan, Liberal, Sault Ste. Marie, ON]

Okay, you guys might want to put that in writing. Thank you very much.

[The Chair, Liberal, Judy Sgro]

Thank you.

Mr. Savard-Tremblay, you have two and a half minutes.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

That's so little time!

Ms. Vasquez-Olguin, you talked about the cases that were before the courts. I think the cases of violence and abuse are quite well documented and are corroborated by several sources. In these cases, you talk about the courts, but I imagine that you find the use of the ombudsman, just an office that receives complaints, insufficient.

Do you believe that a real commission, independent of political power and able to do its own investigations, is needed instead?

[Dr. Silvia Vasquez-Olguin]

That's a really interesting question.

I would start to build up what we have. If we had a really strong ombudsperson with a strong office to support their work, it would be great. An independent commission usually, in my experience, delays the processes a little, and I would say, let's strengthen what's already there. In that sense, maybe I would leave it on the floor for better advice, but in my case, I would say, let's move on with what we already have and strengthen to the points where we can get more effective success and effective justice.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Would you say that this is insufficient, currently?

[Dr. Silvia Vasquez-Olguin]

No, I think it is sufficient. What I'm saying is, let's try to build up the points we already have. I wouldn't advise adding extra bureaucracy to the process that has to be sped up. Anyway, this is my limited position. I'm a sociologist, not a lawyer.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Of course.

I would like to ask Ms. Gingrich much the same question, but I would add this to it.

Many Canadian companies are Canadian only on paper. Indeed, Canada is a real flag of convenience that makes it easy for companies to register here. The Toronto Stock Exchange also offers advantages.

Are Canadian laws too permissive in this regard?

[Meg Gingrich]

As you know, I'm not a total expert on this, and I know that there is debate in terms of how we define a Canadian mining company. I suppose we would say that it's something with headquarters in Canada. It's telling that there are so many mining companies that are headquartered here, whether as a false flag or because they're registered here on paper. Why is that the case? Perhaps it is related to the ability to act differently abroad from how they would have to in Canada. That's why we're arguing for these rules to be so much stricter in terms of what they're required to do. If they are to be headquartered in Canada or if they're Canadian on paper in some way, then they have a responsibility to act in a certain way along their supply chains.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We'll go on to Mr. Cannings for two and a half minutes, please.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you.

I'll turn to Dr. Dhalla to get some clarity. I was trying to write down things you were saying. You made some comments about how Canadian mining companies must be required to report, and I think you said something about how they should operate internationally the same way they do in Canada. Could you expand on that to make sure I got the sense right?

[Dr. Rumina Dhalla]

Yes, I think one of the challenges is the understanding that we act a certain way here in Canada where there's a regulatory framework and legal recourse, yet when we go away, we're so far away that perhaps we may act differently. Then we say, “Well, we're just doing what the competition is doing,” or, “We're doing what the locals require us to do.” I guess the idea is to ask whether we can operate the way Canadian companies operate and find a way to be successful.

For example, I'm a business professor by profession, and we work with companies that have done so well when they really pay attention to the triple bottom line. I mean, they really do well. They invest in renewable energy. They invest in new technologies to reduce the use of water. They work with local communities. The gender equity numbers are really strong. Those kinds of things are happening, so why does it feel like we don't think our Canadian mining companies can do that? I really think when you make....

For example, the integrated reporting that so many companies are now required to produce—the financial, social and economic—we're seeing more and more companies producing it voluntarily, but then more and more companies are going to be required to produce it, because they're listed on the exchange.

When you start reporting on things—not just the good things, when you start reporting on good things and everything else that's going on—what are you planning to do? What are you going to do when you don't meet your objectives or if there are accidents, spills—all those things? We see companies really trying to achieve it. Having those targets is really important, because I believe companies really do want to do better. The ones we work with are striving to do better.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Would it be advantageous to have bills like C-262 and C-263, which really put a stronger lens on this?

[Dr. Rumina Dhalla]

I'm not an expert on those bills, so I don't really know, but it sounds as though we're on the right track.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Carrie, go ahead for five minutes, please.

[Colin Carrie, Conservative, Oshawa, ON]

Thank you very much, Madam Chair.

Mr. Gauthier, I would like to follow up on a question my colleague from the Bloc asked in his commentary about a company he heard about, which was transferred over from Chinese hands. It's really important that we hear from witnesses who are on the ground and who have experience. We appreciate all of the witnesses being here, but I'm curious as to whether you could give us an opinion on how Canadian companies function internationally compared to how companies from China perhaps, or even from America or the U.K. do, because sometimes the countries on the ground give you a choice—you go Canadian or you go Chinese. Would you be able to enlighten us as to what the on-the-ground differences might be and how we compare?

[André Gauthier]

Do you mind whether I answer in English or in French?

[Colin Carrie, Conservative, Oshawa, ON]

You can reply in French if you like, we have no problem with that.

[André Gauthier]

The Chinese are just about the worst in the mining industry, and we had the same problems when we worked in China. It's like that in Africa and Latin America, but in China too. I guess the reasons are cultural, and again there are big differences.

Ms. Vasquez-Olguin mentioned Rio Blanco. The Chinese are there. I don't know about the Canadian mining company that was sold to the Chinese in Colombia, but I know about projects in Colombia generally. I don't know about the circumstances of that sale, but I'm not at all surprised that the Chinese operate that way. That's their way of doing things. They don't integrate; they bring their own equipment and personnel, and that's a problem.

You've probably heard about the problems in Peru; I'm not talking about the most recent ones, but the ones that we've heard about in the last six months, which involved a company that was mining the Las Bambas deposit. It was a Chinese company, and the problems were due to the very reasons I just mentioned.

Unfortunately, Canadian companies are not very far away, and quite often they find themselves in a difficult situation, as the protests are aimed at the mining industry. This situation was not created by the Canadian mining industry, but it is being affected by it. It happened recently, in the last six months, in the Cuzco region, and a Chinese company was involved. Unfortunately, we were in the same countries at the wrong time. So the behaviour of the Chinese is terrible all over the world.

The British that register in Canada have their own mentality, which is very different from the Canadian attitude in the mining sector. I would say that in the mining sector, Australian companies behave like Canadian companies. American companies do not align all that much with the Canadian approach, and South African companies, to not mention them by name, even less so. Canadians and Australians work to about the same standards, but I would say the others certainly work very differently.

[Colin Carrie, Conservative, Oshawa, ON]

Thank you very much for that, because I think it's very important to differentiate between specific problems and systemic problems. As Dr. Dhalla was saying, we want to make sure Canadian companies are competitive internationally, but that we are doing that in a way that brings the standards up for everybody.

Here's another question: How would you define a Canadian company? You know, some of these companies register here. When you're looking at them and evaluating and regulating them on the ground, what would you consider if you were giving us some advice? How would you define a Canadian company?

[André Gauthier]

This is funny, because when you are in some other country, you always have the Canadian Chamber of Commerce. For example, there is one in Peru, one in Chile and one in Argentina. It's like every company would like to be Canadian. Of course we created our own success. If you look at the Toronto Stock Exchange today, it's the main exchange for the mining industry worldwide. In the beginning it was London. Today everybody wants to be in Toronto. Now, does it make them Canadian companies? That's another story.

The other problem we're facing—and I've said this before—is the junior industry. There are really two different industries—the junior exploration and the senior extraction are two different worlds. As I said, the juniors try to work according to the standards we have discussed; however, along the lines sometimes—and that's probably what happened if they were a junior in Colombia—then they have to sell all they have, and they don't really bother to the extent that they should.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Gauthier.

Mr. McKay, go ahead, please, for five minutes.