I was sad to hear last week that the C-300 Bill was defeated last week in the Canadian Parliament, after over a year of suspense. What was C-300, you may ask? Despite its name, it is not a highly explosive form of dynamite, although to hear Canadian mining companies talk about it, you might have thought that it had the potential to singlehandedly devastate Canada’s economy. Rather, C-300 was a sensible bill introduced by Liberal MP John McKay to require the Canadian government to investigate credible allegations of violations of international human rights and environmental standards by Canadian mining companies, and to withhold public money to companies that have committed abuses. ERI advocated for C-300 by sending a letter of support when the Bill was in front of the Standing Committee on Foreign Affairs and International Development last year.
A recently leaked report prepared by the Prospectors and Developers Association of Canada shows that – even according to their own estimates – Canadian mining companies have a vastly higher incidence of CSR violations than other countries. Yet in their (ultimately successful) campaign against C-300, companies and industry associations argued that:
- The Bill would harm Canadian competitiveness by providing ammunition to the foreign competitors of Candian companies
- The Bill would hinder Canada’s recovery from the recession by targeting an economically vibrant sector of the Canadian economy
- The Bill would undercut voluntary, cooperative processes that are the only really promising avenue for the promotion of human rights by industry
- The Bill would allow “special interest groups” to file frivolous compaints that would only serve to smear the reputation of Canadian mining companies
- The Bill’s vague wording would make guaranteeing compliance nearly impossible
- The Bill would harm Canada’s foreign relations by asserting the government’s right to sit in judgment of actions that took place on foreign soil
Some of you might recognize all these arguments as variations on familiar themes. It’s interesting – if tragic – to see how the firestorm that swirled up around C-300 parallels many of the struggles we’ve had in this country over corporate accountability mechanisms. For example:
- The American Petroleum Institute and Shell have submitted comments to the SEC on the implementing regulations for the transparency provisions of the Dodd-Frank Financial Reform Act (which requires extractive companies to report their payments to foreign governments), protesting that U.S. business will lose a competitive edge if they have to disclose contract payments that non-covered foreign businesses do not have to disclose.
- In the debate over reforming the U.S. National Contact Point, who is responsible for responding to claims that U.S. businesses have violated the OECD Guidelines for Multinational Enterprises, business groups have complained that greater transparency would allow unscrupulous civil society organizations to unfairly use the process to drag their names through the mud.
- After the BP oil disaster in the Gulf of Mexico, oil companies successfully forestalled a legislative amendment that would have lifted the liability cap in future spills, arguing that such an action could impel them to close down operations in the United States.
- One of the most common objections to using the Alien Tort Statute to hold corporations accountable for human rights abuses in the course of their foreign operations is that it allows courts to interfere in foreign relations and improperly exercise extraterritorial jurisdiction.
I won’t take the time to go through all the counter-arguments here, but it’s important to address one absurd argument whose superficial appeal makes it particularly misleading. In these tough economic times, extractive companies are getting a tremendous amount of traction by insisting that measures to tighten accountability for their abusive and polluting actions at home and abroad would cost jobs and slow economic recovery. Yet to my knowledge, no one has ever pointed to a single credible shred of evidence that a program of responsible conduct including basic human rights due diligence systems, reasonable environmental performance, and a common-sense measure of transparency imposes burdensome costs on multinational companies. (To the contrary, it’s entirely plausible that such a program would bring companies substantial medium- to long-term financial benefits.) The extractive industries have time and again shown their willingness to go to the mats to oppose any measure that would require them to apply universally recognized standards to their conduct abroad as well as at home; in this context, their tendency to resort to economic scare tactics reads less like a prediction of unavoidable consequences than a threat – if you try to hold us accountable, we will devastate your economy by shedding jobs and leaving en masse for a less regulated environment.
There is one silver lining in this sad saga. The C-300 Bill lost by just seven votes; the final vote in the Canadian House of Commons was 140 to 134. For a private members bill (a bill introduced by a MP without the support of the government), it’s actually quite impressive that C-300 made it this far. The ruling Conservative Party actively opposed C-300, and not a single Conservative MP voted for it. In fact, if all Liberal MPs had actually shown up for the vote and supported the Bill, it would have passed. (14 were not present for the vote.)
This suggests to me that awareness and disapproval of corporate abuses is growing in Canada. If the public comes to expect that Canadian mining companies will conduct themselves according to universally held standards of human rights and environmental performance abroad as well as at home, then maybe next time around, we can convince those seven extra MPs to show up and vote…