Escalating Social Risk for Mining Sector

Canada's CSR Counsellor for the Extractive Sector, Marketa Evans, writes in the Canadian Mining Journal about social risks affecting the mining industry globally.  In the management of social risk, including the risks of community conflicts and social opposition, Ms. Evans states that the industry has so far taken more limited measures than have been taken for environmental risks, even though increasing evidence suggests that social risk constitutes a material risk to mining operations. Full article can be read here.

Corporate liability for human rights violations in Canada?

Can a Canadian parent company with a subsidiary operating in a foreign jurisdiction be liable for human rights violations in the foreign jurisdiction that occur at the level of the subsidiary? Janne Duncan, Michael Torrance and Janet Howard discuss a recent decision in which a Canadian court has allowed this issue to proceed to trial. Whatever the outcome at trial where issues of liability will ultimately be determined, one thing is clear: international public expectations are changing, and directors and officers of Canadian companies need to be aware of the potential risk of claims by foreign plaintiffs seeking redress for alleged harm committed beyond Canada’s borders.

Increased Risks of Liability for International Human Rights Claims Brought in Canada

On July 22, 2013, the Ontario Superior Court of Justice in Choc v. Hudbay Minerals Inc. 2013 ONSC 1414 (the “Hudbay Decision”) dismissed a preliminary motion of the Defendants, Canadian mining company, Hudbay Minerals (Hudbay), thereby allowing the lawsuit against the company to proceed. The claim, which is yet to be proven, alleges Hudbay is responsible for human rights abuses allegedly committed by mine security personnel at Hudbay’s wholly owned and controlled subsidiary, Compania Guatemala de Niquel (CGN), in eastern Guatemala.

As noted, the matter has yet to proceed to trial and none of the allegations raised have yet been proven. That being so, this case has important implications for Canadian businesses operating abroad. In essence, the finding means that a complaint

Human Rights Due Diligence in International Finance

Revisions to the Equator Principles (EP) have created new requirements for businesses to conduct human rights due diligence in order to qualify for financing from 79 of the world’s largest financial institutions. The EP apply globally to all project financing with a value of over $10 million and to certain types of corporate loans, bridge loans and project finance advisory services. This development brings the importance of human rights due diligence beyond reputational risk management and ties it directly to access to capital for many companies. It also significantly increases the significance of human rights considerations for the financial industry.

Keewatin v Ontario: Court of Appeal affirms Ontario’s unilateral ability to take up treaty lands

Jocelyn Kearney of Norton Rose, one of the authors of IFC Performance Standards on Environmental and Social Sustainability: A Guidebook, writes about a recent key decision of the Ontario Court of Appeal that will have implications for the understanding of indigenous rights and the duty to consult in Canada. This development should be of interest to Equator Principles banks grappling with the meaning of Free Prior and Informed Consent, which is now part of the IFC Performance Standards requirements, which must be interpreted with consideration to the well developed legal concepts from which its meaning derives.