Nov 30 2009
Bill C-300
There has been a lot of debate about the proposed Bill C-300. In the Mining Engineering department of UBC, Professor John Meech recently emailed the faculty and graduate students a link to a mining weekly article, outlining the arguments for and against Bill C-300. Dr. Dawn Mills proposed an open formal debate.
A bit of background on Bill C-300:
Bill C-300 was introduced to the Canadian House of Commons in February of 2009 by Liberal Member of Parliament, John McKay. The bill is intended to regulate Canadian mining companies operating in developing countries by creating a guideline for accountability to which companies must comply. The bill will also create a sytem by which complaints against companies can be filed and brought to the attention of Canada’s Ministry of Foreign Affairs and International Trade.
In August, Mining Watch released its opinion on the bill. Its position is largely positive, stating that this bill is “the best chance we have as Canadians to assure that Canadian extractive companies follow human rights and environmental best practices when they operate overseas“. On November 26, 2009, a joint standing committee released its position on bill C-300. This standing committee was made up of representatives from Barrick Gold, Kinross Gold, and Goldcorp. The committee is concerned that the bill is too simplistic and one-dimensional, which will cause undue economic burden and unjustified harm to the reputation of Canadian mining companies. The committee goes on to state that bill C-300 “is unnecessary as Canadian companies are already subject to a variety of domestic and international rules, regulations and guidelines holding companies to account in the area of CSR“.
In my opinion (or rather, my questions)…
Is this bill really our best hope? Or will it simply cause mining companies to leave Canada and set-up shop in less regulated regions? If Canada truly is over-regulated to the point of economic ruin, then one wonders: why would companies operate here at all? And if these companies are already made accountable through existing policies, why do incidents of social and environmental degradation mining companies with headquarter in Canada still occur? (e.g. HudBay Minerals Inc. in Guatemala, TVI Pacific in Mindanao and former Argentine minister’s recent complaints to the House of Commons). Who benefits from this bill being passed? And, who benefits from having these mining companies continue to operate as they are? Canada certainly benefits by having these companies hold headquarters within its borders economically through jobs and taxes… don’t they?
The truths in all of this can be found within the underlying motivations of the parties involved.
Any thoughts?
Not sure what you mean by finding the truth in the motivations of the parties. The mining companies do not want more regulations or the frivolous complaints. The moralist seeks moral behavior enforced by the government. The NGOs are delighted to see a mechanism to get at the mining industry. Maybe the oprressed in many nations find comfort in Canada’s better behavior (than say China’s) I find the absence of due process most scary–akin to denying me the right ot buy beer at the local grocery store.
Seriously, I post many more incendary opinions on this bill at http://www.ithinkmining.com. Your turn to go comment there.
[…] Since I originally posted this piece, a great deal of comment has appeared on the web. I have been surprised by how slow and muted industry response has been. Today I came across the posting at this link that attempts to put forward a defence of the industry and a set of reasons why the bill should not be passed. I recommend the article. As always for every one posting against the bill, there is one in favor. The posting at this link looks at the reality of threats by Canadian mining companies to leave Canada if the bill were passed. Even the students in the mining department at UBC have gotten into the act. […]
[…] summarized on a UBC blog by Sheila Ballantyne “Bill C-300 was introduced to the Canadian House of Commons in February of 2009 by Liberal Member […]
Are some of the heated discussions around the Bill C-300 designed to regulate the CSR performance and access to funding by the EDC of Canadian extractive industries operating abroad, a storm in the tea cup?
I note that Bill C-300 builds on the key standards and guidelines which are already being promoted by the Canadian government’s CSR strategy for Canadian International Extractives, such as IFC Performance Standards, Voluntary Principles, and GRI’s sustainability reporting framework.
In terms of the Export Development Canada (EDC), which has already adopted the Equator Principles (based on the IFC Performance Standards, currently being reviewed – see also http://prizmablog.com/2010/01/07/revise-or-mainstream-the-ifc-performance-standards/), poor CSR performance, ranging from environmental damage to human rights abuses, would already seriously complicate EDC’s involvement and/or trigger contractual clauses for divestment if they are already involved in related project finance activities. EDC’s loan, subscription and political risk insurance agreements (at least the more recent ones) should already contain provisions for CSR-related performance reporting, be subject to EDC’s due diligence (and site visits) and include independent engineer reviews to help verify performance.
The need for more effective recourse mechanisms and grievance procedures is a real issue and already high on the agenda of the newly appointed CSR Councellor (see also here: http://prizmablog.com/2009/12/14/review-mechanism-priority-for-canadian-csr-councellor/) and there are some good and not so good models out there. So there is perhaps no need to re-invent the wheel again. But the remaining interesting thing is probably the issue of ‘lifting the corporate veil’ and allowing individuals/organizations to ‘go after’ Canadian listed companies for poor CSR performance of their subsidiaries in other host countries. And this topic is already at the heart of an initiative spearheaded by Professor John Ruggie, the Special Representative of the United Nations Secretary-General, on the issue of human rights and transnational corporations and other business enterprises.
Are there perhaps additional or other ways to more effectively address desirable CSR performance improvements and provide for better accountability mechanism of the extractive sector in emerging markets? Similar note also added to my blog: http://www.prizmablog.com.
Mehrdad Nazari, Senior ESIA & CSR Advisor, Prizma (www.prizmasolutions.com)