Mr. Speaker, it is a pleasure to speak today to the issue of corporate social responsibility, particularly in the extractive industries.
I want to start by correcting the parliamentary secretary's comments. He suggested that this began with the advent of the Conservative government, but that is not the case.
Much of what we are talking about today is the landmark report from the parliamentary Standing Committee on Foreign Affairs and International Trade, tabled in June 2005. It is a landmark report on mining in developing countries and corporate social responsibility.
I would be remiss if I did not, on behalf of all members of the House, thank non-governmental organizations, like KAIROS, which have really done a yeoman's job of ensuring that this issue has been kept in the forefront for several years. For quite a while, it seemed like the issue had disappeared, but we all know how important it is. NGOs, like KAIROS, have really done a great job of keeping our feet to the fire, as elected officials, to ensure this issue is in front of Canadians.
This is an extremely important issue. I want to talk for a moment on some basic concepts in terms of what corporate social responsibility is rather than pure rights.
Although major objective of extractive companies is to earn profits, they also have a responsibility to advance social goals, given the transboundary nature of their operations and the concomitant reduction of the welfare role, particularly in developing in countries. Some may put forth the argument that these are private companies and they really do not have a role to play whatsoever, but they do have that role to play.
We all know about the common concept of triple bottom line. This is not a theoretical issue; it is an issue that connects to the bottom line of the private sector, and I will get into that in a moment.
Corporate social responsibility implies compliance plus the active development and implementation of a mainstream business strategy, supported by technological and organizational innovation to prevent, and this is important, social impact while at the same time optimizing social benefits from the outset. Through responsible management, it also involves the mitigation, on an ongoing basis, of negative effects, if and when they occur.
Historically this was not the case. In fact, Milton Friedman, in his 1970 book The Social Responsibility of Business is to Increase its Profits, made the argument that social performance was totally contained in marketplace performance. I would argue, with all due respect to Milton Friedman, that he is wrong.
Today we know that social responsibility in business is not entirely up to the marketplace, with the objective of ensuring the private sector extracts profits. Engaging in social responsibility is important not only for the people in the countries where the company is located, but also for its ability to do its best and provide its highest level of performance.
The approach to corporate social responsibility can be summarized in the following way. Operating a successful business is important with respect to the interests of employees, investors, suppliers and customers. It is important to make social investment in a local community in response to the perceived moral imperatives as well as ensuring a healthy workforce. I will give the House an example.
I have been to South Africa 13 times. I used to work there in years past. Extractive industries in South Africa found that their employees were rapidly dying due to tuberculosis, malaria and other infectious diseases. The underlying cause of this were viruses known as the HIV class.
Extractive industries, particularly those involved in diamond and gold manufacturing, could not accept this. The destruction of their workforces was having a profound negative impact on their bottom line. These industries became involved in the health care of their workforce by enabling them to get access to medications, particularly the antiretroviral medications that not only prevent a person going from HIV positive to developing AIDS, but also significantly diminish infecting other people.
Allow me a short aside. It is important because this discovery was actually made and championed by the British Columbia Centre for Excellence in HIV/AIDS at the University of British Columbia in Vancouver.
Doctors Montaner and Kerr found that the highly active anti-retroviral therapy, that is, triple therapy, can actually drop the viral load so low for individuals that it prevents them from being able to infect another person. This is actually quite remarkable, because if we can drop somebody's viral load so low as to prevent him or her from being able to infect another person, it dramatically truncates the ability of the virus to infect new people. This is a huge challenge we have in terms of trying to arrest what is arguably the biggest challenge in global health.
The South African extractive industries got involved in that and were able to keep their workforce healthy. By keeping the workforce healthy, they were able to significantly improve their bottom line. That is the essence of the moral imperative. That is how it connects the moral imperative with the profit-making nature of the private sector.
It differs quite significantly from Milton Friedman, who believed that the private sector market could, by the very nature of driving toward the acquisition of profit, take care of these social needs as a downstream effect. We now know that is not the case at all.
We would like to see Canada championing a series of requirements that the private sector understands it has to adhere to when working abroad. If these companies do not, there will be consequences for that. I know that the private sector would like to have those guidelines, because currently these companies are working in the dark a little.
I believe we have to define for the private sector the guidelines we want it to adhere to in terms of mitigating the environmental and social impacts in all spheres, the biophysical, the economic and the social, and anticipating, preventing and dealing with these at the outset, not after the fact.
I want to look at the positive and negative effects of extractive industries for a moment. I am glad that the issue of Talisman was brought up, because I was in Sudan when Talisman was there. I went into the bush south of Bahr El Ghazal in Southern Sudan when the war was going on.
For all that people were harassing and being critical of Talisman for being part of the Greater Nile Petroleum Operating Company, the fact of the matter is that Talisman was the only group on the ground providing health care and educational opportunities for the Nuer and Dinka tribespeople who live in Southern Sudan.
As for removing Talisman, all those people who wanted Talisman to go actually deprived some very impoverished people in Southern Sudan of health care and educational benefits. In the process, Talisman was replaced with another company, which does not care whatsoever what happens to those people. Subsequent to that, Talisman has done what I think is a very good job under the auspices of Greg Manhas and his team to provide a very good model that other extractive industries may wish to look at in terms of corporate social responsibility.
The downstream effects have been very interesting, not only in terms of the extractive industries but also in terms of other large industrial endeavours in developing countries. We know that developing countries do not have the capacity on the ground and most of them are rife and riven with corruption. We have seen massive environmental damage, horrific health effects on people who live in certain areas, conflict, and something called the Dutch disease.
What is the Dutch disease? Developing countries have put all their eggs in one basket, an extractive industry, at the expense of maximizing innovation in other non-extractive industries. In the process, they have negatively affected their economy and the downstream effect. By focusing on one industry and not putting adequate resources into other industries to diversify their economies in years to come, they get the Dutch disease. These countries have been negatively affected.
Let us look at a couple of examples. What is happening in the delta region in Nigeria right now is horrific. Companies such as Shell and others are committing atrocious acts in collusion with the Nigerian government, I have to say, against the people who live in the delta.
In Ogoniland, which is part of the delta, we see gas flaring. Gas flaring is causing catastrophic effects on the health of the people who live there, from sky-high cancer levels to other illnesses. The spinoff benefits to the people are negligible at best. The people who are hired on the rigs are not local people. They are foreigners and very few in number. If locals are hired, it is for menial work.
There is no ability to build capacity in these developing countries. That is what these extractive industries should be doing. It is not for them to be aid agencies, we know that, but it will improve their bottom line if they are able to sensibly utilize some of their profits to invest in the social well-being of the people there.
They can invest in training and in capacity building, which is key. They can give the people jobs and an opportunity to acquire skills so they will be better able to contribute to their economy. They can give them water security, food security and health care. All of these things could be done by the private sector.
The Canadian government should work with the private sector to enable this. They could be very good and very willing partners. A partnership between a private sector company and the Canadian government through CIDA could be a very constructive partnership, in effect, by working with people on the ground, with domestic NGOs, in a recipient country to build capacity, to enable countries to have the water security, food security and health care they require and also the economic development these countries need to be able to improve.
However, some of this is heartbreaking to see. I will give the example of sub-Saharan Africa, which is the poorest area in the world.
Do members know that sub-Saharan Africa has 40% of the world's natural resources? Yet the poorest people in the world live there. Why is that? Because of lack of capacity and also because of conflict and corruption, what I call the three c's, which are the three biggest problems that affect that part of the world. The extractive industries have the ability to play a very important role here.
I will also talk for a minute about environmental impacts. I mentioned the devastating effects of oil exploration in Ogoniland in the delta in Nigeria, but we also can look at the Congo River basin in Amazonia.
In the Congo River basin, particularly in the eastern part of the Congo, there has been a genocide taking place for a number of years. More than 7 million people were killed in under five years in the eastern Congo. Did anyone hear about that? Did anyone care or do anything about that? No, they did not. Right now, every day, day in and day out, this means that the equivalent of four large passenger jets are exploding and killing more than a thousand people. That is the equivalent.
A thousand people are dying every day in the eastern Congo, but what do we hear? Nothing. Could we imagine what would happen if 1,000 people or even 100 people were dying every day in the west? There would be enormous attention paid to that.
What is also interesting is that in the eastern Congo there is a lot of extractive industry taking place for coltan, gold, diamonds and other minerals. The absence of any interest is allowing a festering wound to continue on the body politic of the world. The murder, maiming and mass rape of ultimately millions of civilians in eastern Congo is done in front of us but in such a way that no one is paying any attention.
These issues are not hidden. They are in front of us. The absence of any interest on the part of the west to address these problems is something that I frankly cannot begin to fathom, having seen this so many times myself.
In Amazonia, the same thing is happening with the destruction of the environment.
However, not all is for naught. There are things we can do. There are things that Canada could lead on. There is a willingness on the part of our private sector to work with the government to establish a set of guidelines to be adhered to.
As I said to the parliamentary secretary, the government should also rewrite the Special Economic Measures Act. SEMA is obsolete. We must have a way of imposing punitive actions against a private sector actor from Canada which is acting in ways that are egregious abroad, ways that we would never tolerate within our own country. I would encourage the Government of Canada to do that.
I would also say that the government needs to work with the private sector to enable that to happen. It needs a buy-in from the private sector to do that.
The government could also learn from companies such as Talisman, which has done a good job. I know that some of the other private sector groups in the world, such as Rio Tinto, BHP and placer mining, for example, have been doing some good work in trying to improve their ability to engage in CSR, but I have to say that they need to do a better job of letting the public and us know about that. Many would be willing to work with them.
I also found it very interesting when dealing with the private sector that while there is certainly some goodwill because companies understand the triple bottom line, they may not necessarily know how to achieve it. There is the ability for those of us in Canada who are involved in this area to offer ideas, solutions and ways of operationalizing this.
I would suggest that if anyone from the private sector is interested in engaging in this, what they could do is utilize the administrative structure that UNAIDS did. It is called the “Three Ones”. What is it? It is one framework, one operational mechanism, and one oversight mechanism. If companies do that, they are able to utilize their moneys in the most efficient and effective fashion possible.
I would also suggest dealing with what I would argue is one of the biggest challenges, as I mentioned early on, and that is the issue of capacity building. What international and large NGOs often do, which I think is really criminal, is that they hand a framework to developing countries.
Hundreds of thousands of dollars will be spent on producing this framework. These NGOs will give it to a developing country and say, “Here it is”. The people of the developing country will look at it and say, “That is nice, but how on earth can we hope to actually implement this if we do not have the capacity to implement?”
I will use a case as an example. President Johnson-Sirleaf of Liberia is a remarkable woman. She is trying to dig her country out of years of being subjected to conflict as a result of the greed and avarice of a thug, former president Taylor of Liberia, who subjected his people to unspeakable horrors. He destroyed his country. It was all because of a desire to have diamonds.
What President Johnson-Sirleaf needs is capacity building. She needs western countries and the private sector to help in building up the capacity within her own country so that Liberians can have the administrative frameworks and the governance structures that are required.
They need the ability to have the proper checks and balances, the banking system, the legal system and the security apparatus so the people of the country can be secure and also so there is the ability to invest in the educational opportunities the Liberian people need.
What do we have? Nothing. The world just disappears. Extraction still takes place, but there is an inability to connect the extractive industries and their profits. That is not only for the private sector but, very importantly, for the countries who need to use those moneys to build up their own capacity.
The last issue is conflict. I want to go again to the issue of Zimbabwe, because it is very important. We know that Mr. Mugabe and the four members of his joint operations committee have destroyed their country. We know that they are burning civilians alive. We know that as Zimbabwe falls, so does the entire southern African region in many ways.
I would implore the Canadian government to work with SADEC and the African Union to say to the leadership in Zimbabwe that if it does not stop this violence, if it does not allow election monitors to go into the country, and if it does not have a free and open election at the end of this month, then that leadership will be prosecuted for crimes against humanity.
If the leadership does not comply, then we must tell its members that we are going to organize an invasion force, a multilateral peacemaking force, to go into Zimbabwe. It should not be difficult. We know that 80% of the country is living on less than a dollar a day and most are malnourished and starving. A very small number is brutalizing these people. It needs to be removed.
The British did it in Sierra Leone and ended a conflict there that claimed a quarter of a million lives. We need to do the same in Zimbabwe as far as I am concerned. If we do not, then our responsibility to protect will mean absolutely nothing.
