Natural Resources Committee on June 21st, 2012

[David McGuinty, Liberal, Ottawa South, ON]

Right.

I heard recently from the executive vice-president of CARE Canada, who was positively despondent. They're the single largest recipient of American money in the NGO world.

I'm not sure why the government is pursuing this. I'm hoping they're going to stop, now that they've managed to ram this through in the budget document.

I want to turn to Ms. Kuzenko, if I may, for a second. You've just inked a number of agreements. You're an operator in a lot of rural areas. You've just signed an impact and benefit agreement.

How does Vale, your board, and how do your shareholders—your management team, for example—see the role of environmental NGOs in the process? Do you believe they're a hindrance, they're partners, or do you believe they are a force to be reckoned with? How do you see it?

[Jody Kuzenko]

I personally believe that NGOs are an important part of the process. They bring a sense of independence and a different lens on the assessment, permitting, and regulatory approval processes.

We spend a lot of time with NGOs. We have formal what we call “kick the tires” tours so that people like Mr. Amos can come to our operations and learn about who we are and what we stand for as an operation, and we can develop I think some common ground and mutual understanding.

I don't think Mr. Amos doesn't want mining. I don't think his group doesn't want mining. I don't think NGOs don't want mining. I think we all want to do it responsibly, and there is more common ground there than there are differences.

[David McGuinty, Liberal, Ottawa South, ON]

So let me ask both you and Ms. Briño to respond to this. In the 21st century, if you're looking to do business in Canada, for example, or more importantly, if you're looking to do business outside of Canada, isn't it really widely understood now in the mining sector that the higher the environmental performance the more competitive you actually are, particularly in foreign jurisdictions?

Can both of you help us to understand that?

Ms. Kuzenko, first.

[Jody Kuzenko]

I completely agree with that. We view environmental performance and environmental responsibility as a key competitive advantage. It's one of the reasons for a $2 billion spend on an environmental project.

We report out against the Global Reporting Initiative—a GRI index specifically designed to report apples-to-apples comparisons on environmental performance against major industry players. Investment firms are making investment decisions based on our performance on the GRI index, so there is no question in my mind about that. Environmental responsibility is a competitive advantage, and in this day and age, as we're developing the next generation of miners, it is critically important to recruitment and retention.

[David McGuinty, Liberal, Ottawa South, ON]

Ms. Briño.

[Karina Briño]

I can only echo that. In terms of what the mining sector and the mining industry are doing today, we do want the best environmental scientists working for our companies and for our sector as well. The mining sector does care about the environment, just as anybody else does. We don't want to go in there creating a disaster. It does not make business sense.

In terms of our work with environmental groups, my role is that of community engagement and relating to the media as well. That has allowed me to develop relationships with organizations and groups that I wouldn't have normally talked to before, groups like the David Suzuki Foundation, CoalWatch on Vancouver Island, and the West Coast Environmental group, because we need to be able to sit down and have a conversation about how we do responsible development.

So our commitment is there. I think it is getting better in terms of our direct relationship as well, and we need to stop talking about mining and the environment as if they were in confrontation.

[David McGuinty, Liberal, Ottawa South, ON]

Mr. Macdonald, the parent company—forgive me—involved in your operation again is...?

[Gordon Macdonald]

Rio Tinto is one of our owners.

[David McGuinty, Liberal, Ottawa South, ON]

Right, and they're a pretty big global player, aren't they?

[Gordon Macdonald]

That's correct.

[David McGuinty, Liberal, Ottawa South, ON]

I used to act for Rio Tinto, and I learned long ago that Rio Tinto actually tries to abide by an international standard wherever it operates. It tries to pull up standards and base itself in part, like Shell does, on the highest standards in the jurisdiction where.... You follow my logic.

I'm not sure if you were there at inception, but when Rio Tinto began its negotiations with respect to this project, did it import its highest standards and bring them to bear on this project?

[Gordon Macdonald]

Yes, we had numerous reviews from Rio Tinto to try to ensure that the standards we were implementing into the design and planning for the mine met Rio Tinto's standards. We were all on the same page on that one. They were very much looking for a world-class operation. New mines are an opportunity to get it right.

[The Chair, Conservative, Leon Benoit]

Thank you, Mr. McGuinty. Your time is up.

[David McGuinty, Liberal, Ottawa South, ON]

Thank you, sir.

[The Chair, Conservative, Leon Benoit]

We'll go now to Mr. Daniel for five minutes.

Go ahead, please, sir.

[Joe Daniel, Conservative, Don Valley East, ON]

Thank you very much, Mr. Chair.

Thank you, witnesses.

I'm going to follow up on the question from my colleague Mr. Anderson and really look at what benefits there are to the aboriginal communities in these remote places, because clearly they need to benefit from the extraction, from mines, from minerals, etc. So the question is, really, what experience has there been in terms of aboriginal communities getting involved in benefiting from the resource development, particularly your mine extraction?

Anybody...?

[The Chair, Conservative, Leon Benoit]

Go ahead, Mr. Macdonald.

[Gordon Macdonald]

I can start.

There are two avenues for engagement. One is through direct employment, which we have been quite successful with.

The other one, which I think is even more successful, is through aboriginal businesses. We spend a lot of time trying to break up our procurement and our contracting to enable smaller contracts, to help develop aboriginal businesses. They have been very successful. They're starting to work outside of our employment and in other mines and have even started to look internationally. I think that kind of business development with aboriginal communities is probably the most long-lasting opportunity for them.

[Joe Daniel, Conservative, Don Valley East, ON]

Okay. Anybody else?

[The Chair, Conservative, Leon Benoit]

Ms. Kuzenko, go ahead please.

[Jody Kuzenko]

Our operations have had tremendous success with aboriginal development, most specifically so with our impact and benefit agreement in Voisey's Bay. Fifty-five per cent of our employees there are from the Innu and Inuit first nations. Many millions of dollars go to their communities for providing services to our operations.

We believe that our role in aboriginal development is capacity building wherever our operations have an impact on their way of life. So we favour employment opportunities, education opportunities, contracting opportunities over cash payments with our aboriginal partners. In our view that's a way that we can contribute to the sustainability of the first nations community after the mine shuts down.

[Karina Briño]

The only thing I would like to add is that I think the industry is assuming its responsibility as well in terms of creating capacity in the aboriginal communities themselves. I think it is important to ensure that the people representing their bands have the knowledge and expertise to be able to comment on and review applications that are being put forward to them, for example. That's not only for the mining sector, but for all sorts of other activities as well. They need to have the ability to respond to the demand in terms of reviews. I think it is important that we contribute to creating that capacity as well. I just have to echo what's been said until now.

[The Chair, Conservative, Leon Benoit]

Mr. Amos.

[Prof. William Amos]

I'd simply like to relay the experience from the National Energy Board's Arctic offshore review in which it was very clear that communities and organizations such as the Inuvialuit Regional Corporation and the Inuvialuit Game Council were very concerned about the employment benefits and the training benefits that would flow from potential offshore development, in comparison with the risks that their communities would be faced with in the event of a blowout.

The offshore industry is a very technical industry. It's quite normal for many people who are working on the rigs to be brought from far away. I think the issue of training and employment in Arctic communities as regards offshore development is a critical one, and Ecojustice is not necessarily the appropriate organization to comment upon it. I think that it does speak to a broader need to go slowly so that if there is going to be drilling, the employment benefits and the training benefits accrue to northerners. One doesn't have to be a northerner or a representative of a northern organization to see the merit in that approach.

[The Chair, Conservative, Leon Benoit]

Mr. Daniel, you have about 30 seconds.