In 2009, the Canadian government created a Corporate Social Responsibility (CSR) strategy for Canada’s international extractive sector, which was subsequently revised in 2014.
Despite these efforts, Canada still has not addressed the corporate accountability gaps in the overseas operations of Canadian companies. Many concerns remain, including:
- A human rights Ombudsperson for the international extractive sector has yet to be created,
- Significant hurdles for people from outside of Canada who have been harmed by Canadian companies abroad to get a court hearing in Canada,
- Out of court mechanisms, such as the National Contact Point for the OECD Guidelines and the Office of the Extractive Sector CSR Counselor, don’t have real powers to sanction companies or offer remedy to victims.
- State agencies that support corporations, such as Export Development Canada, lack the legal and administrative mechanisms to ensure they are respecting human rights.
The result is impunity for human rights abuse and no recourse for those affected by environmental disasters or human rights violations at the hands of Canadian-based resource extraction companies.
In the lead-up to the 2015 federal election, almost every major Canadian political party committed to act on the recommendations of the Advisory Group to the National Roundtables on Corporate Social Responsibility.
The CNCA looks forward to assisting the Government of Canada in following through with its public commitments to act on the Roundtable recommendations, including the creation of a human rights Ombudsperson.
Canadian Government Support to Companies
The Canadian government actively promotes and supports the international operations of Canadian extractive companies.
This support takes many forms:
- Financial backing (eg. financing, insurance, loans and loan guarantees are provided through Export Development Canada)
- Political backing (eg. support by embassies and trade commissions in opening doors overseas)
- Promotion of pro-business reforms in countries where Canadian extractive companies operate (eg. weakening environmental regulations and social protections, lowering tax rates, or including robust investor protections in trade agreements in stark contrast to the lack of inclusion of mechanisms to enforce investor obligations).
- CSR funding, support and overseas development aid (eg. advice from the CSR Counsellor’s office, joint projects with Global Affairs Canada to fund mining project community initiatives overseas, use of overseas development aid to establish the Canadian International Resources and Development Institute (CIRDI))
The UN’s Guiding Principles on Business and Human Rights (UNGPs) call on governments to adopt accountability mechanisms as part of their legally-mandated duty to protect human rights. The UNGPs recognize that, in order to fulfill that duty, states may need to require human rights due diligence by government agencies and businesses. Unfortunately, Canada has so far failed to do so. As a result, Canadian government support is sometimes going to companies involved in conflict, human rights abuses and severe environmental disasters – as evidenced by the recent massive tailings spill in Brazil – involving a company financed by Export Development Canada.
Canada must take action to ensure that Canadian government support does not go to companies who fail to respect human rights and environmental norms. Bill C-300 (Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries Act, a bill that would have created environmental and human rights obligations for extractive companies that receive Canadian government support that was narrowly defeated in 2010) would have gone a long way towards preventing government complicity in corporate abuse.
Canada’s CSR Counsellor’s Office
As part of the 2009 CSR Strategy, the Government of Canada created the Office of the Extractive-Sector CSR Counsellor.
To date, the CSR Counsellor has failed to successfully mediate a single case brought before it. At least half of the companies subject to review have refused to participate. Minor changes to the Office in 2014 failed to address its shortcomings.
- The CSR Counsellor is not mandated to investigate complaints, or determine whether companies have caused harm or breached the government’s guidelines.
- The Counsellor cannot make (binding) recommendations.
- The office is not independent: the Counsellor reports directly to the Minister of Trade.
- The guidelines promoted by the Counsellor’s office are weak on indigenous rights, including the right to free, prior and informed consent.
- The CSR Counsellor cannot provide, nor recommend any sanction or remedy: if that were to be provided, it is at the company’s discretion.
Human Rights Due Diligence
Human rights due diligence is a key component of a corporation’s responsibility to respect human rights. In 2011, the CNCA and its international partners jointly launched a project aimed at determining how governments could require or encourage businesses to undertake human rights due diligence activities. The report from this joint project, Human Rights Due Diligence: The Role of States was launched at the 2012 UN Forum on Business and Human Rights.
The Canadian government hasn’t acted on the Report’s recommendations. Canada was recently critiqued by the United Nations Economic, Social and Cultural Rights Committee because of the ”lack of impact assessments explicitly taking into account human rights prior to the negotiation of international trade and investment agreements.”
National Roundtables on CSR (2006-07)
In 2005, the Standing Committee on Foreign Affairs and International Trade (SCFAIT) studied the problem of unregulated mining, oil and gas operations and human rights abuses associated with Canadian companies overseas, and directed the Canadian government to take specific actions. As a response to this report, in 2006 and 2007, the Government of Canada organized a series of roundtable sessions that included representatives from government departments, industry, academia and civil society. The CNCA coordinated the participation of concerned groups and individuals at these roundtables.
The Advisory Group to the National Roundtables released a series of consensus recommendations that were supported by industry and civil society groups. Those recommendations remain as pertinent today as they were when first released in 2007.
CNCA’s 2015 Parliamentary Report Card documents the commitments of the Liberal Party of Canada, New Democratic Party of Canada, Green Party of Canada and Bloc Quebecois to implement these recommendations.
In a handful of cases, companies have successfully argued that hearings are better held in courts where the injury took place. In another case, a parent company in Canada has argued that it should not be responsible for the actions of its subsidiary in the foreign country.