Canadian companies expected to uphold ethical standards abroad under new strategy

OTTAWA — Canada has announced a new responsible businessstrategy to ensure companies prevent or ease negative effects to human rights and the environment in their operations overseas.

Advocates, however, are criticizing the strategy for being largely a repeat of the previous one put in place by Stephen Harper’s Conservative government in 2014.

Canada’s international trade minister said the new strategy will help Canadian companies operating abroad to build on the “Canadian brand” and set themselves apart from competitors.

Minister Mary Ng said the strategy is a set of tools and supports to help companies adopt high ethical standards, including to uphold human rights and protect the environment.

“Businesses are shooting themselves in the foot, to their own success, by not having strong responsible business conduct, because we know that having it will just make them more successful,” Ng said in an interview.

Emily Dwyer, who heads the Canadian Network on Corporate Accountability, said the strategy fails to centre the rights of people and communities affected by corporate wrongdoing.

Catherine Coumans, research co-ordinator at MiningWatch Canada, said there was basically “nothing new” in the strategy.

“I just started thinking, ‘Oh my god. All I’m seeing is just a repeating of things that already exist.’ Just the tiniest tweaks.”

The previous strategy focused on the extractive sector, while the new strategy is not industry-specific.

Ng said the strategy and the work of Labour Minister Seamus O’Regan will be “complementary.”

O’Regan said last week he is preparing legislation to make Canadian companies ensure that they are not using slave labour or exploiting child workers overseas.

The five-year strategy announced by Ng aims to have Canadian companies put in place responsible business practices.

The government said it will include provisions in bilateral and multilateral trade agreements to advance responsible conduct globally.

Dwyer noted that the strategy says the government has been doing that since 2009, which means it hasn’t been having an effect, because companies are still involved in abuses.

The strategy also does not say what those provisions will specifically contain, she said.

“We certainly think that having a human rights focus … embedded in trade agreements is important. But there’s not enough detail in the strategy to see what is actually meant by that,” Dwyer said.

Companies that use the Trade Commissioner Service, which helps sell their products and services abroad, will need to attest that they will engage in responsible business conduct.

The service’s benefits can be withdrawn if a company fails to comply with Canada’s “laws, policies and standards” on responsible business conduct.

Ng did not say how binding the strategy is, but said “countless” companies that want to grow and work internationally rely on the Trade Commissioner Service.

Coumans said the attestations are not new, as the 2014 strategy had “integrity agreements” that performed the same function. These agreements are problematic because they are not made public, she said.

“If people don’t know which companies have signed these and which companies have not, we can’t hold either the company or the government to account,” Coumans said.

Anyone who wants to report grievances against companies for alleged wrongdoing can go to the National Contact Point, a government agency meant to address human rights and environmental complaints, or the Canadian ombudsperson for responsible enterprise, a watchdog for human rights abuses by Canadian companies abroad.

Ng praised the ombudsperson, calling the office a very good tool for ensuring Canadian companies respect human rights.

“They’ve got the tools and the resources to do the work that they have been given the mandate to do,” said Ng.

Dwyer said the strategy fails to deal with the fact that these two dispute resolution mechanisms “are completely ineffective.”

A 2015 report by OECD Watch looked at national contact points from several countries including Canada over a 15-year period. It found “the overwhelming majority” of complaints do not stop corporate misconduct or give harmed people remedy for abuses.

The ombudsperson lacks real powers to investigate or to compel documents and testimony, Dwyer said. “So expect that the result is going to be the same.”

The Liberal government appointed the first ombudsperson in 2019, replacing the “corporate responsibility counsellor,” which had faced widespread criticism as a toothless entity.

At issue is whether the new ombudsperson Sheri Meyerhoffer, a lawyer with a long record in business and international development, can compel reluctant companies to co-operate with her investigations and follow her recommendations.

Ng said she is “very confident” in the work Meyerhoffer is doing.

Last month, two federal New Democrats, Peter Julian and Heather McPherson, tabled two private-members’ bills that would make Canadian companies more accountable for human rights abuses and environmental harms abroad.

Julian said Bill C-262 would create legal tools, giving victims of human rights violations by Canadian companies abroad recourse in Canadian courts.

McPherson said Bill C-263 would give the corporate responsibility watchdog the power and teeth to investigate wrongdoing by Canadian corporations.

Dwyer said the two bills fulfil the criteria that she is looking for.

This report by The Canadian Press was first published April 28, 2022.

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This story was produced with the financial assistance of the Meta and Canadian Press News Fellowship.

Erika Ibrahim, The Canadian Press