On January 17, 2018, the federal government announced two new initiatives to hold Canadian companies doing business and operating abroad accountable for human rights violations abroad.
- The creation of an independent Canadian Ombudsperson for Responsible Enterprise, to investigate allegations of human rights abuses linked to Canadian companies’ activities abroad.
- The creation of a multi-stakeholder Advisory Body comprising civil society and industry experts to advise the Government and the Ombudsperson on corporate conduct abroad.
These two initiatives are founded on the Government’s commitment to advance human rights by supporting Canadian companies in operating responsibly and improving access to remedy for alleged human rights abuses arising from Canadian company operations abroad. The Government has provided some highlights but will soon clarify with more details how these new initiatives will operate.
1. Canadian Ombudsperson for Responsible Enterprise
The Canadian Ombudsperson for Responsible Enterprise (CORE) will be authorized to investigate allegations of human rights abuses arising from Canadian corporate activity abroad initially in the mining, oil and gas, and garment sectors, with the expectation to expand within a year to other industries. The process for submitting a complaint will include an appeals process to ensure that companies accused of abuses are treated in a clear, predictable and transparent manner.
This person will operate with a budget that allows him or her to conduct independent investigations, be appointed through an order-in-council that will determine the specifics of the mandate and the related responsibilities and carry out his or her duties full-time for a term of up to five years.
As part of the Ombudsperson’s mandate and investigative powers, he/she will, among other things, have the ability to:
- undertake collaborative fact-finding;
- initiate independent fact-finding, even without the submission of a complaint;
- report throughout an investigation; and
- make recommendations to parties involved in the complaint, as well as to the Government.
If a company refuses to cooperate in the process, the Ombudsperson can recommend denial or withdrawal of certain Government services (e.g., trade advocacy support and the financial support of Export Development Canada) as an interim measure or as a final recommendation.
2. Multi-stakeholder Advisory Body
The Advisory Body will comprise experts in civil society and industry and will report to the Minister of International Trade. Its role will be to advise the Government on the effective implementation and further development of its laws, policies and practices addressing the social responsibility of Canadian companies operating abroad, in particular with the creation of new laws and regulations. The Advisory Body will help the Government determine the Ombudsperson’s mandate and investigative procedures.
Members of the Advisory Body will participate on a voluntary, non-paid basis. They will meet four times annually but may hold additional meetings as necessary.
Impact of these initiatives on global employers
The Government’s new initiatives are not new obligations for Canadian companies operating abroad. These companies must already respect applicable human rights and Canadian laws and are encouraged to operate in compliance with international corporate social and environmental responsibility standards (which are voluntary standards), such as the Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises.
What the new initiatives do is implement an independent compliance driven and investigation process for Canadian companies operating abroad that violate existing human rights standards, including possible sanctions for companies found to have violated international standards, such as withdrawing trade advocacy support or making them ineligible for government financial support.
In addition, the Ombudsperson’s investigations and recommendations will be made public, which could damage the reputation of Canadian companies.
The Government announced that both entities will take office as soon as possible, but did not give a specific date for the adoption of the order-in-council officially establishing these new entities.