Mother Earth and Resource Extraction: Women Defending Land and Water

Multinational Corporations in Canada

Leer la versión en español de este contenido: Empresas multinacionales con sede en Canadá.

Multinational Corporations and Corporate Social Responsibility

 A company is different than a corporation. Corporations are the grouping together of people and companies into a single entity. By registering as a corporation, the liability of shareholders is limited to financial participation. When a corporate organization operates in more than one country, it becomes a multinational corporation (MNC). Most Canadian mining companies are MNCs. Multinational companies are funded in multiple ways including issuing equity, government subsidies, and private financing agreements.

Corporate Social Responsibility (CSR) is a form of self-regulation by private companies as a promise to conduct business in a responsible manner. These self-imposed best practices help a company mitigate risk and these measures are not considered a legal obligation. CSR is not a selfless act, but rather helps to create good-will, or a ‘social licence to operate’. The development of CSR can be directly linked to neoliberalism and the decentring of state controls. CSR has created a landscape where MNCs set their own standards rather than having to follow standards set by the governments of where the company is headquartered.

As a direct result of a global over-reliance on self-regulation and CSR, international mechanisms have not been developed to ensure MNCs respect international human rights standards and face consequences for violations. This is especially problematic for mining projects as they often occur in areas where local laws are weak on human rights and the environment or where existing laws are not enforced against big businesses. Many resource development projects are in rural areas where the local (frequently Indigenous) communities do not have the same access to justice as those located in urban areas. Compounding these issues, many countries in which MNCs operate have biased court systems which prevent fair representation.

To create a new culture of corporate responsibility around mining there needs to be a more home-state-centred approach to accountability. Canada needs to show initiative and regulate companies that are headquartered in the country.

Canadian Stock Market 101

Stock markets exist as a place for investors to buy and sell their investments, or securities. Stock markets also create indexes to measure the average value in a package of investments which reflect in general how the market is behaving. A stock is representative of a slice of ownership in a company. In a public corporation, anyone can buy stocks and become a shareholder. Most mining companies are public.  

Canadian stock exchanges are the leading destination for publicly traded mining MNCs. Canada is attractive to mining companies as a place to list, because not only is there a historical basis for industry specific knowledge, but additionally, there are favourable conditions such as low listing and disclosure requirements.  

For an MNC to list itself on a Canadian stock exchange, the company does not have to have Canadian directors, a primary headquarters in Canada, or majority Canadian shareholders. When registering on a Canadian stock exchange, companies must complete a prospectus offering (a disclosure of company information) and meet the industry specific minimum listing standards. Companies can qualify as a “designated foreign issuer” if fewer than 10% of its equity (stocks) are owned by residents of Canada; these companies are then not subject to Canadian disclosure requirements. 

The largest stock exchange in Canada is the Toronto Stock Exchange (TSX) along with the Toronto Venture Stock Exchange (TSX – V). Under the National Instrument 43-101 Standards of Disclosure for Mineral Projects, resource companies can disclose both mineral reserves and resource estimates. This is enticing for companies because it increases the value of the stock. 

Here are the listing requirements and the disclosure standards for mining companies on the TSX and TSX-V . 
Canada is also a favourable destination for MNCs to list due to the friendly tax conditions provided by governmental financial assistance. The Canadian government has smoothed the way for countries to invest in Canadian stock exchanges by providing opportunities for exploration companies via political capital and trade agreements. See the Corporate Accountability section of this hub to learn more about the neoliberal policies that carved an attractive investment landscape for extraction companies on a global level. 

One example of a tax-based financing incentive available to the mining sector is a flow-through share. These shares are paid by taxpayers and help especially smaller mining companies pay for exploration. Many large Canadian institutions such as universities and banks are invested in these companies because indexes with mining stocks are seen as stable and profitable.  

In 2017, 59% of the global mining financings were done on the TSX and TSXV with a total value of $206 billion CAD. 
Top mining companies in Canada in no particular order:  
- Barrick Gold (merged with Randgold Resources in Jan 2019) 
- Teck Resources Limited 
- Agnico Eagle Mines Limited
- Goldcorp Inc.  
- Yamana Gold Inc. 
- First Quantum Minerals Ltd. 
- Kinross Gold Corporation 
- Cameco Corporation 
- Lundin Mining  
- B2Gold 

To check whether a company is listed on the TSX and TSXV, use the TSX's Listed Company Directory



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