Watchdog to keep tabs on corporate conduct abroad
OTTAWA Investment firms, human rights groups and aid agencies gave a thumbs-up Wednesday to the Liberal government’s decision to create an independent watchdog to enforce responsible conduct of Canadian companies operating abroad.
International Trade Minister Francois-Philippe Champagne announced the new position, saying the office would be first of its kind in the world, and that he would take an active role in making sure it prevented any bad corporate behaviour that might tarnish Canada’s broader brand.
The new Canadian ombudsperson for responsible enterprise is intended to be a substantive upgrade to the current “corporate responsibility counsellor,” which has been widely criticized as a toothless entity for dealing with misconduct complaints against Canadian companies, mainly in the mining industry.
The ombudsperson will work toward resolving conflicts between local communities and Canadian companies operating abroad, and will focus on several sectors, including mining, oil and gas and the garment sector, said Champagne.
It will have the power to independently investigate and make recommendations in cases involving human rights complaints, he said.
Champagne said the government may withhold support, including financial, from companies that are found to have committed violations and that he would not shy away from publicly persuading violators to toe the line.
“To fly the Maple Leaf means something. It means being associated with a set of values,” he told a news conference.
The head of BlackRock, one of the world’s largest investment firms, has told companies they need to step up their corporate responsibility efforts if they want to benefit from their investment. Laurence Fink has said if they don’t engage better with local communities they will “ultimately lose the licence to operate from key stakeholders.”
“When investors are reading the morning news, the last thing they want to read about is a risk event happening to a company in their portfolio...,” said Dustyn Lanz, head of the Responsible Investment Association, which represents a range of Canadian financial services institutions.
Alex Neve, the head of Amnesty International Canada, said the new ombudsperson position places Canada at the forefront of enforcing good international corporate behaviour. “It’s not the end of the game when it comes to corporate accountability; it’s a very significant step forward, and it is a moment where Canada has demonstrated some leadership.”
Julia Sanchez, head of the Canadian Council for International Co-operation, said civil society groups such as hers will be watching closely to see that the ombudsperson succeeds. Her organization, an umbrella group for aid agencies, and others will be part of an advisory board that was also established as part of Champagne’s announcement.
“All those pressures, both from consumers, from investors, from government regulatory bodies, all of that can add up and it can have an impact,” said Sanchez.