Volume 12:1 (2016)

PDF icon Steering Toward “True North”: Canadian Corporate Law, Corporate Social Responsibility, and Creating Shared Value

Evguenia Paramonova

Abstract: Recent developments in Canadian company law are stirring the legal imagination by suggesting that corporate social responsibility (“CSR”) could be integrated into mainstream governance frameworks. However, if such a transformative project is indeed underway, it remains incomplete. Landmark decisions from the Supreme Court of Canada have left more questions than answers concerning the fiduciary duties of directors. Commentators bemoan the lack of interpretive guidance from lawmakers on what it means to act in the “corporation’s best interests”, given the corporation’s recasting as a “good corporate citizen”. This article explores the cross-disciplinary potential of emerging business norms to provide such interpretive fodder. A variant of CSR, entitled “Creating Shared Value” (CSV), has had significant normative pull with companies, business academics, and policymakers alike. Emphasizing the social embeddedness of corporations, CSV suggests that a manager’s core objective is to maximize “shared value” (rather than shareholder value) by developing strategies and operations based on loci of mutual interest between the company and its stakeholders. By presenting managers with a clear objective and guidelines for balancing competing interests, CSV addresses two significant flaws in the current formulation of the fiduciary duty. The CSV norm ought to be embodied within existing corporate governance legislation, thus completing a “feedback loop”— business patterns will generate norms that breathe life into law so that law will have more instrumental vigour to regulate those business patterns. Ultimately, this could achieve more meaningful corporate sustainability patterns.

PDF icon Indigenous Rights, Environmental Rights, or Stakeholder Engagement? Comparing IFC and OECD Approaches to Implementation of the Business Responsibility to Respect Human Rights

Sara L Seck

Abstract: The Organisation for Economic Cooperation and Development (OECD) Guidelines for Multinational Enterprises (OECD MNE Guidelines) and the International Finance Corporation (IFC) Performance Standards on Environmental and Social Sustainability (IFC Performance Standards) are widely viewed as key international standards to which extractive companies operating internationally should comply. Indeed, these standards, together with the United Nations (UN) Guiding Principles on Business and Human Rights (UNGPs), are promoted by Canada in its November 2014 enhanced corporate social responsibility (CSR) strategy for extractive sector companies operating abroad. The strategy states that the Canadian government expects companies operating outside of Canada to “respect human rights and all applicable laws, and to meet or exceed widely-recognized international standards for responsible business conduct”. Yet the OECD and the IFC take distinct approaches to the embedding of indigenous rights and environmental rights, two categories of human rights commonly affected by extractive company operations. For example, the OECD MNE Guidelines address human rights and environment in different guidelines, and there are no specific guidelines concerning the rights of indigenous peoples. The IFC Performance Standards, on the other hand, refers to human rights only briefly in the first performance standard as part of its social risk assessment, but provides more detailed standards on various environmental and social matters including biodiversity conservation, pollution prevention and indigenous peoples’ rights. However, in early 2016, the OECD released a Due Diligence Guidance for Meaningful Stakeholder Engagement in the Extractives Sector (OECD Stakeholder Engagement Guidance) designed to provide practical guidance in line with the OECD MNE Guidelines. This paper will examine the commonalities and differences between the IFC and OECD approaches to the integration of business responsibilities for human rights with a focus on procedural environmental rights and the right of indigenous peoples to free, prior, and informed consent (FPIC). The paper will also briefly assess the potential effectiveness of these instruments in light of associated compliance mechanisms.

PDF icon Parens Patriae and Public Trust: Litigating Environmental Harm Per Se

Monique Evans

Abstract: In Western legal traditions, environmental harm is generally viewed through a strict anthropocentric lens—an approach that has thus far failed to deliver on the goal of environmental sustainability. The author argues that recognition of environmental harm per se in Canadian law would enhance environmental protection and presents vehicles for addressing such harm through litigation. In particular, the author examines options for litigating environmental harm per se: governmental actions under the parens patriae jurisdiction and their converse— citizen actions against government under the doctrine of public trust. Although both options have their own limitations, both could be used to effectuate the law’s potential role in creating a sustainable future.

PDF icon Paradiplomatie environnementale en perspective : analyse de la mise en œuvre des engagements internationaux du Québec dans l’espace nord-américain

Annie Chaloux

Abstract: Over the last thirty years, Québec’s participation in the international environmental scene has intensified. The province has sought to show the importance and relevance of federated states in environmental global governance, and to legitimize their regulatory role in the collective problem solving needed to tackle global environmental issues. Given Québec’s participation in this type of international activity, the following question can be posited: has the province implemented and respected the international commitments made to its North American partners? This question, although crucial at both theoretical and practical levels, has so far been examined in the literature only in a fragmented and incomplete manner, despite Québec’s recent adoption of a strong discourse on its green diplomacy. This article provides an in-depth analysis of the extent to which Québec is implementing and respecting its international environmental commitments. This is accomplished through a detailed examination of three specific North American case studies, namely, the New England Governors and Eastern Canadian Premiers’ Annual Conference’s Action Plan to Reduce the Impacts of Climate Change, the Western Climate Initiative’s greenhouse gas emissions cap and trade program, and the Council of Great Lakes’ Governors’ Great Lakes– St. Lawrence River Basin Sustainable Water Resources Agreement. The results of this research show that, for all three case studies examined, Québec tends to implement and respect its environmental commitments to different North American partners, making it a dependable international actor.

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