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Canada's National Contact Point (NCP)

Annual Report 2008

Introduction

The OECD Guidelines for Multinational Enterprises is an instrument of the Organization for Economic Cooperation and Development (OECD). The recommendations set forth in the Guidelines are a voluntary, multilateral framework of standards and principles on responsible business conduct.

As a member of the OECD and signatory to the Guidelines, Canada is obligated to establish a national contact point (NCP). The role of the NCP is to promote awareness of the Guidelines and ensure their effective implementation. This report provides a summary of the activities undertaken by Canada's NCP in the past year (June 2007 - June 2008).

The Canadian Policy Context

The Guidelines continue to be an important element of the government's approach to promoting corporate social responsibility (CSR). A number of federal government departments are active in this area, through activities such as information dissemination, facilitation of dialogue among interested parties, promotion of CSR in international fora (such as the OAS and the G8) and support for the development of international norms. The Guidelines are a central part of these activities, their contribution heightened by the fact that they represent the shared views of thirty-nine national governments on what constitutes appropriate corporate behaviour.

The business community in Canada is promoting CSR as well, with an increasing number of enterprises adopting codes of ethical conduct and related management strategies. The Guidelines offer a frame of reference for private sector initiatives and the NCP serves as a mechanism to facilitate cooperation between the government and the business community in the promotion of CSR. The Guidelines and NCP also provide a forum for engagement with other key stakeholders, such as labour groups and non-governmental organizations (NGOs) on CSR issues.

The Guidelines make an important contribution to the Government's policy on promoting sustainable development. Achieving sustainable development requires the responsible engagement of all sectors of society, including the business community. The Guidelines encourage corporations' contribution to sustainable development and help to strengthen the basis of mutual confidence between enterprises and the societies in which they operate.

Thus, while our NCP has a clear mandate to implement the Guidelines, its activities also support broader policy objectives of the Government.

2006 National Roundtables on Corporate Social Responsibility and the Canadian Extractive Sector in Developing Countries

The Government of Canada, led by the Department of Foreign Affairs and International Trade (DFAIT), hosted four public Roundtables on CSR and the Canadian Extractive Sector in Developing Countries. These Roundtables were held from June to November 2006 in Vancouver, Toronto, Calgary and Montreal. The Roundtables were a consultation process to engage industry, civil society and the public in a solutions-oriented discussion on how to enable the Canadian global extractive sector to better identify and manage the social and environmental risks of their operations.

The Advisory Group for the National Roundtables released the "Advisory Group Report", which is the final output of this year-long consultation process, on 29 March 2007.

This report is non-binding for the Government of Canada. However, its recommendations provide valuable input to a government response, which is currently being prepared through an interdepartmental process. More information can be found on the roundtables on the website.

So far, two of the Report's recommendations have been implemented. First, Canada announced its support for the Extractive Industries Transparency Initiative, including a contribution of $1,150,000 to the EITI Trust Fund over the next four years. Second, Canada enhanced the public reporting of the Canada Investment Fund for Africa. In addition, at the 2007 Heiligendamm Summit, G8 leaders agreed to promote a consolidated set of CSR principles including the ones identified in the Advisory Group Report, i.e. the International Finance Corporation Performance Standards, the Voluntary Principles on Security and Human Rights, and the Global Reporting Initiative. The government is carefully reviewing the recommendations developed by the National Roundtables Advisory Group and will make public its proposed course of action once finalized.

Throughout this process, representatives of Canada's NCP provided input into the development of these Roundtables and participated in the events. They continue participating in the process of the elaboration of a response to the Advisory Group's recommendations.

Institutional Arrangements

The key responsibilities of Canada's NCP are to promote the Guidelines, respond to inquiries and contribute to the resolution of specific instances of corporate conduct in relation to the Guidelines. Important guiding principles for the NCP's activities include visibility, accessibility, transparency and accountability.

The chairmanship of the NCP is under the control of the Department of Foreign Affairs and International Trade Canada. In April 2008, a process was started to transfer the role of NCP chair and coordinator from the Investment Trade Policy Division to the Trade Commissioner Service Overseas Operations Division. This Division has a team that advises trade commissioners in Canada and abroad on CSR and coordinates an annual CSR-related program on the trade side of the Department of Foreign Affairs and International Trade, which includes training trade commissioners on CSR. Once the transfer is competed, their contribution and their vast network in Canada and abroad will help Canada's NCP implement the Guidelines more effectively.

The Canadian NCP's key business and labour interlocutors on the Guidelines are the Canadian Chamber of Commerce (CCC), the Canadian Labour Congress (CLC) and the Confédération des syndicats nationaux (CSN). The NCP also has frequent contact with domestic and international NGOs.

Information and Promotion

a) Information and Promotional Tools

The Canadian NCP web site is a useful tool for promoting the Guidelines. It has also become an efficient way to communicate information on the Guidelines to our overseas missions. All of our embassies and high commissions have been informed of the Guidelines and the importance of this instrument for the promotion of CSR.

Overall, the web site offers a convenient point of reference for a growing number of Canadian organizations and businesses that are seeking information on CSR. To increase the visibility of its web site, Canada's NCP has asked its interdepartmental members to include a link to the Canadian NCP web site below their signature-block in their emails.

Various other federal government web sites promote the Guidelines, including the Trade Commissioner Service's internal web site, DFAIT's CSR web site, and the sites of other departments and agencies, such as Industry Canada and Natural Resources Canada.

b) Promotion with Social Partners

More focus is being given to the extractive sector (mining, oil and gas). Because Canada is a major player in the global extractive sector, both the Canadian Government and the Canadian industry share an interest in maintaining a positive image of Canada in this sector, and ensuring that Canadian businesses contribute positively to the broader social and environmental objectives of the communities in which they operate. Promoting the Guidelines in this sector is a concrete way for the Government to engage Canadian companies in supporting these objectives.

As the representative of the Canadian NCP, an officer of DFAIT's Investment Trade Policy Division participated in a seminar on human rights and companies within the framework of La Francophonie, which was held in Rabat from February 28 to March 1, 2008. At that time, she was able to make the Canadian NCP visible to many stakeholders attending from various countries of La Francophonie and draw the attention of some people raising questions about Canadian companies to the Guidelines as well as to the review mechanism for specific instances provided by the NCP.

Canadian Embassies and High Commissions abroad provide support and services to Canadian firms interested in expanding their international business operations. As a result, our embassies are an excellent vehicle for the promotion of the Guidelines in cooperation with the business community. Our embassies incorporate CSR-relevant information, including references to the Guidelines, in the business briefings to Canadian clients. In addition, they communicate the Government of Canada's commitment to CSR to both Canadian, local business audiences and relevant stakeholders. In 2007, for instance, the Canadian Embassies in Ecuador, Peru, Guatemala and Senegal organised CSR multi stakeholder seminars, with a special focus on the extractive sector, that included NGOs, host governments, think tanks, academics, indigenous organizations, religious leaders and representatives of Canadian companies. Indeed, mining is one of the largest sectors of Canadian direct investment abroad.

Industry Canada continues to promote the Guidelines as part of its CSR activities to strengthen the capacity of Canadian business to develop and use CSR practices, tools and knowledge to achieve positive economic, environmental and social performance results. Links to the Guidelines and the National Contact Point appear on the department's CSR website, which receives about 8000 hits per month. With a view to the implementation of CSR related action items in the department's Sustainable Development Strategy (2006-2009), Industry Canada supported and disseminated the results of the following research: a study on the integration of CSR practices into Industry Associations, including the development of a how to roadmap for industry associations; a study on the integration of CSR practices into business processes of leading Canadian and international companies; a study on CSR performance reporting; a research paper on the CSR trends and drivers of supply chains, including case studies, guides and tip sheets for SMEs. IC will continue to build the business case for CSR through research, articles and participation in conferences. Industry Canada also is a member of the Research Network on Business Sustainability, which brings together stakeholders in business, government and academia. This network affords the department the opportunity to promote the Guidelines and the NCP to stakeholders.

Environment Canada is actively collaborating with the private sector, academics, non-governmental organizations and other government departments to explore CSR principles and policies that encourage and support corporate sustainability leadership and are broadly aligned with the principles of the Guidelines. Environment Canada has provided CSR information, tools, and best practices to market actors to enable them to better integrate environmental considerations into their decision-making and thereby strengthen the business case for sustainability performance. The department's past work and knowledge base in this area will continue to support implementation of the Guidelines.

Canadian agencies that work with the private sector internationally continue to promote awareness of the Guidelines among their partners. This is the case, for instance, of the Canadian International Development Agency (CIDA). CIDA raises awareness of the Guidelines among its partners and stakeholders in the private and other sectors through participation in outreach events across Canada, e.g. International Development Days, and internationally, e.g. Inter-American Conference on CSR, and through Canada's aid programs with a view to encourage sustainable business practices among local or foreign enterprises in developing countries and a positive contribution by the private sector to poverty reduction.

Export Development Canada's (EDC) commitment to CSR principles and standards includes the promotion of the Guidelines. EDC supports the NCP's efforts to promote the recommendations of the Guidelines within the Canadian exporting and investing community. EDC meets with its customers, various business associations, NGOs, and other stakeholders on CSR issues as part of its efforts to promote ethical corporate conduct and continue a dialogue with these groups. Issues relating to the Guidelines, such as the environmental and social impacts of projects, anti-corruption and anti-bribery efforts, and human rights are discussed, when relevant. In addition, EDC also promotes the Guidelines through its website.

c) Promotion within the Government

Promoting the Guidelines within the government is an essential aspect of the NCP's responsibility to raise awareness of the instrument. A number of departments and agencies interact directly with the business community, labour groups and NGOs through their programs and consultative activities. This is an important channel for alerting these groups of Canada's commitment to support the Guidelines. The interdepartmental structure of the NCP greatly facilitates promotion within government.

The Department of Foreign Affairs and International Trade (DFAIT) provides information sessions on the Guidelines for overseas trade officials. Indeed, Canada's Trade Commissioner Service recognizes the importance of including CSR as an element of its promotional activities. Responsible business conduct by Canadian companies abroad reinforces the positive effects that trade and investment can have on human rights, the environment and competitiveness. Canada's trade commissioners are encouraged to incorporate the promotion of CSR (including the OECD Guidelines) into the delivery of the core services provided to Canadian companies operating abroad. DFAIT is, with that perspective in mind, enhancing the capacity and knowledge of government officials on CSR through training and development of tools.

Industry Canada (IC) continues to promote the Guidelines within its department and across federal departments with a view to improving the co-ordination and advancement of CSR and sustainability within government. Within the department, CSR related seminars and workshops are regularly featured and the Guidelines are often referenced at that time. The annual internal course on Sustainable Development also references the Guidelines and the NCP. Among federal departments, IC participates in an interdepartmental working group under the CSR Memorandum of Understanding. This group collaborates on projects and also works closely with the NCP. Industry Canada also participates in an interdepartmental working level group closely monitoring developments with respect to the ISO Guidance Standard on Social Responsibility (ISO 26 000). Industry Canada published an article in a public service magazine on CSR and its relevance to competitiveness.

Environment Canada is actively collaborating with the private sector, academics, non-governmental organizations and other government departments to explore CSR principles and policies that encourage and support corporate sustainability leadership and are broadly aligned with the principles of the Guidelines. Environment Canada has provided CSR information, tools, and best practices to market actors to enable them to better integrate environmental considerations into their decision-making and thereby strengthen the business case for sustainability performance. The department's past work and knowledge base in this area will continue to support implementation of the Guidelines.

CIDA is promoting the Guidelines through internal knowledge networks comprised of officials working in private sector development and governance. The Guidelines are also being mainstreamed in work on conflict prevention and on poverty reduction in fragile states.

The Labour Program of Human Resources and Social Development Canada, which is part of the Canadian NCP, has specific expertise for and particular interest in the labour-related principles. The Labour Program manages Canada's participation in the International Labour Organization (ILO) and promotes compliance with the Declaration on Fundamental Principles and Rights at Work, which encompasses the following fundamental principles and rights: freedom of association and the effective recognition of the right to collective bargaining, the elimination of all forms of forced or compulsory labour, the effective abolition of child labour, and the elimination of discrimination in respect of employment. These principles are embodied in the OECD's Guidelines and in the Tripartite Declaration on Principles Concerning Multinational Enterprises and Social Policy.

Inquiries

A number of inquiries about the Guidelines were received by the NCP in the past year. Inquiries received via e-mail are often from think-tanks and academic institutions looking for information on Canada's experiences with the Guidelines. Other inquiries come through meetings with businesses or NGOs. Canadian Embassies and High Commissions abroad have also requested information on the Canadian NCP. Often such inquiries are about the nature of the Guidelines and their possible application in certain situations. As well, the Guidelines are occasionally raised in the public's correspondence with Ministers.

Submissions and Implementation in Specific Instances

No submission or specific instance was dealt with by the Canadian NCP during the current reporting year. However, during her participation in the seminar on human rights and companies within the framework of La Francophonie held in Rabat from February 28 to March 1, 2008, the onsite representative of the Canadian NCP was put in touch with various stakeholders, including members of NGOs and government organizations who made her aware of the conduct of certain Canadian companies in countries of La Francophonie. The NCP is currently following up on this.

Concluding Remarks

The OECD Guidelines for Multinational Enterprises continue to be a central element of the Government's approach to promoting corporate social responsibility, domestically and internationally. The interdepartmental structure of the NCP facilitates the promotion of the Guidelines within the Government and with departmental constituencies, including business, labour and NGOs. The NCP looks forward to new opportunities in the coming year to promote the Guidelines. The NCP will also follow up as required to the Government's response to the Advisory Group's Report on CSR and the Canadian Extractive Industry in Developing Countries.