Corporate Accountability
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An overview on the need for corporate accountability of the Canadian extractive sector
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2020-08-28T11:56:30-07:00
Leer la versión en español de este contenido: Responsabilidad Corporativa
For nearly four decades, financial speculation, free trade agreements entwined with state-sanctioned deregulation, promotion of consumption as a national economic driver, and the simultaneous shift towards planned obsolescence as production strategy—all driven by transnational corporations’ incessant thirst for higher and higher profit margins and general state disinvestment from its social responsibilities—have exacerbated the scope and scale of resource extraction across the globe.
Complicating matters, world financial institutions, such as the International Monetary Fund (IMF) and the World Bank (WB), began advocating for “developing countries” to implement national economic policies based on a set of principles dubbed the “Washington Consensus.” These principles prioritized macroeconomics that loosened international trade barriers and lowered the amount of money states spent on social services. Countries deemed “developing” were required to implement this latest iteration of capitalism, neoliberalism, through conditional loaning policies. Without the adoption of structural adjustment programs designed with neoliberal ideals in mind, countries could not obtain international loans. The adoption of neoliberalism effectively opened borders to transnational large-scale resource extraction, now understood to be one of the premier drivers for national economic development.
There is no better country that epitomizes this latest enactment of capitalism than Canada. According to the Government of Canada, more than half of the world’s mining companies are headquartered in Canada. Tax incentives and federal regulation make Canada an enticing base for corporations seeking to establish mining operations not just nationally but also internationally.
Unfortunately, Canada’s global prowess in the extractive sector is also tied to human rights and environmental violations and their impunity, a reality that is compounded by the fact that, globally, projects are typically found on or near Indigenous communities. Too commonly, extractive projects provoke spills, contamination of fresh water sources, and destruction of habitats. Indigenous communities who have the right to be involved in decision-making spaces regarding megaprojects are criminalized, harassed, or physically attacked when they demand to be consulted, reject a project through democratic processes, or call attention to the negative impacts of resource extraction. Local law enforcement and private security personnel linked to the extractive sector or their subsidiaries are routinely hired to diffuse conflicts over land and water.
At the same time, globally, there has been an alarming rise in the number of human rights defenders killed. According to Frontline Defenders, more than 300 defenders were killed across the globe in 2018; seventy-seven percent of defenders killed were targeted for their work protecting their collective rights and the environment, and Colombia, Mexico, and the Philippines, where KAIROS partners with grassroots organizations, account for about 66 % of those reported killings.
It is imperative that the Government of Canada actively work towards legislation and regulation to hold the Canadian private sector accountable when it does not abide by local, national, and international human rights and environmental laws when operating abroad, either directly or through subsidiaries. To accomplish this, the Government of Canada must:
- grant an independent ombudsperson complete investigatory power;
- enact legislation that requires Canadian agencies and crown corporations to undertake due diligence in a manner that is transparent and does not obscure outcomes;
- and not finance, insure, or support companies that have been found to be involved in environmental and human rights abuses in their business operations.
