Annual Report 2001:

The 2000 review of the OECD Guidelines for Multinational Enterprises (the “Guidelines”) was the most far-reaching and comprehensive since the Guidelines’ inception in 1976. At the outset of the review, OECD Members identified the role of the National Contact Point as important to raising the profile and improving the effectiveness of the Guidelines. To this end, improved guidance has been provided to assist NCPs in carrying out their responsibilities. As well, NCPs will meet annually to share experiences and report to the OECD Committee for International Investment and Multinational Enterprises (CIME).

The following report to the CIME describes the new institutional nature of Canada’s NCP and provides information on the activities undertaken in the past year to implement the Guidelines in Canada. The report also summarizes the Canadian policy context in which the Guidelines are situated.

The Guidelines are an important element of the Government’s approach to promoting corporate social responsibility, at home and abroad. A number of government departments are active in this area, through information dissemination, facilitation of dialogue among stakeholders and support for the development of international norms. Many Canadian enterprises are responding through the adoption of codes of conduct and other management strategies such as training and the establishment of environmental management systems. The Guidelines provide a frame of reference for these private sector initiatives and an institutional home for efforts to encourage progress in this area internationally.

Corporate social responsibility, and 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 the NCP has a clear mandate to implement the Guidelines, its activities also support other broader policy objectives of the Government.

The key responsibilities of the NCP are to promote the Guidelines, respond to inquiries and contribute to the resolution of problems that may arise. In meeting these responsibilities, the Canadian NCP will respect the four core criteria identified during the review as important for improving the effectiveness of NCPs. These criteria are visibility, accessibility, transparency and accountability.

Canada’s NCP has been organized as an interdepartmental committee with representatives from a number of federal government departments. These departments include the Department of Foreign Affairs and International Trade, Industry Canada, Human Resources Development Canada, Environment Canada, Natural Resources Canada, the Department of Finance and the Canadian International Development Agency. Regular dialogue is maintained with the Export Development Corporation as well. The diversity of the issues covered by the Guidelines and the potentially broad spectrum of public interest (business, labour, non-governmental organizations) in Canada underscores the importance of structuring the NCP in this way. Other departments may participate in NCP activities as necessary.

The representatives of Canada’s NCP meet about every two months through their participation in a larger interdepartmental committee on corporate social responsibility. The Guidelines are routinely discussed at these meetings, providing for a greater breadth of promotion within the government as well as coordination of the Guidelines with other related programs and activities. The NCP also meets independently of this larger committee as required, to respond to requests from business, labour or non-government organizations (NGOs) to discuss the Guidelines.

The NCP maintains contact with the key business and labour interlocutors on the Guidelines, i.e., the Canadian Council for International Business (CCIB), the Canadian Labour Congress (CLC) and the Confédération des syndicats nationaux (CSN). Their input was solicited in the creation of a new website and the preparation of promotional materials and other related documents.

A regular point of contact has not been established with the NGO community, although the Guidelines have been promoted with a number of these organizations.

The information and promotion activities have been generally of four types: preparing information and promotional materials; responding to inquiries; making presentations on the Guidelines at key events; and positioning the Guidelines as departmental responses to concerns in society about globalization.

4.1 Information and Promotional Materials

A national website on the Guidelines has been established that reflects the interdepartmental nature of Canada’s NCP. The website, which was launched in early June 2001, includes a summary of the Guidelines, a description of the interdepartmental structure and responsibilities of the NCP, coordinates of the NCP and main business and labour interlocutors on the Guidelines, and a number of related links to Canadian and international organizations involved with corporate social responsibility. Links are also established to the OECD and the key Guidelines documents. The creation of the website provided a good opportunity for dialogue and consultation with the business and labour communities. The NCP plans to send an information notice on its new website to a number of organizations, including the many it contacted during the review process. The NCP also created a two-page summary of the Guidelines which it distributes at promotional events and which can be accessed from its website.

4.2 Inquiries

Since June 2000, Canada’s NCP has received five inquiries for information concerning the Guidelines in addition to those received from the CCIB, CLC and CSN. The requests came from three individuals, a non-governmental organization and a business organization involved in corporate social responsibility, and were concerned mainly with what the government was doing to encourage corporate social responsibility in Canada and the new structure of the NCP.

4.3 Promotional Events

The NCP was invited to make a presentation at a conference organized by the Université du Québec à Montréal in November 2000 on the theme ''Multinational Enterprises and Labour Law''. The NCP representative's presentation focused on both the Guidelines and the ILO Tripartite Declaration for Multinational Enterprises and Social Policy. The presentation was well received and copies of both instruments were provided as well as website addresses. Labour, academic, employer, and government representatives from Canada, France, and the United States contributed to the success of the conference.

In March 2001, NCP representatives gave a presentation on the Guidelines to members of the Canadian Chamber of Commerce. Business community interest focussed on implementation and, in particular, on how the NCP would respond to cases. The follow-up mechanism was portrayed by some as a form of alternative dispute resolution. The importance of maintaining business confidentiality was raised as an important issue as well.

The Guidelines were promoted by the NCP at an all-day meeting between government officials and the NGO community in May 2001. The NGOs were generally sceptical of the effectiveness of voluntary instruments, including multilateral instruments such as the Guidelines. Nevertheless, interest was expressed in how the Guidelines would apply to certain situations, especially in non-adhering countries. The new NCP website was promoted and the NGOs were invited to use the site to express their views on issues related to the Guidelines.

The NCP met with the Executive Director of Canadian Business for Social Responsibility, a member-based organization of Canadian businesses committed to socially responsible policies and practices. The purpose of the meeting was to discuss strategies for promoting and implementing the Guidelines with Canadian companies, including small and medium-sized companies.

NCP representatives promoted the Guidelines at a meeting of the Conference Board of Canada in May 2001. A presentation was made to the Board’s Corporate Responsibility and Ethics Council. This was the first encounter with the Guidelines for most Council members. Considerable interest was expressed on a wide range of issues. Of particular importance was the manner in which cases would be managed by the NCP. Members were of the view that the profile of complaints should be managed to prevent unwarranted negative publicity for companies - reputation is an important corporate asset that needs to be protected. A concern was expressed as well that the Guidelines could become another level of compliance with which firms would have to deal. A clear distinction was made by this group between values-based ethics programs, which are promoted through internal training, etc., and compliance-based programs that required adherence to compulsory standards and regulatory frameworks.

4.4 Promotion Within the Government

Various government departments are promoting the Guidelines through their programs. The Department of Foreign Affairs and International Trade (DFAIT) has integrated the Guidelines into its activities to promote corporate social responsibility at the international level and with Canadian organizations whose operations focus internationally. Close cooperation is maintained with other departments to ensure coordination of Guidelines implementation activities with other related international initiatives, such as the UN Global Compact. The Guidelines have also become an important element of the Departments strategy to promote sustainable development.

Activities are underway in DFAIT to inform departmental staff about the Guidelines. The Department provides information sessions on the Guidelines for its overseas trade officials. Three such sessions took place in the past year. The provision of Guidelines information is also a part of human rights training for government officials preparing for overseas postings. A formal training program on CSR targeted at trade officials is planned, and will include a session on the application of the Guidelines abroad.

To advance the four core criteria for NCP operations (i.e. visibility, accessibility, transparency, and accountability), Canada's Department of Industry has publically-committed to promoting the OECD Guidelines for MNEs in its Sustainable Development Strategy for 2000-2003. This involves not only identifying concrete deliverables regarding the OECD Guidelines (e.g. developing promotional material and identifying opportunities to promote the Guidelines with the Canadian business community), but also reporting publically on these efforts.

Beyond the Sustainable Development initiatives, Industry Canada has also identified the Guidelines as the main departmental response to public concerns about globalization and the activities of multinational enterprises. As such, the Guidelines have been promulgated throughout the department, particularly to all areas which are involved in investment development activities. Essentially, these groups have been requested to hotlink their respective websites to Canada’s National Website on the OECD Guidelines for MNEs and to circulate a brochure about the Guidelines to client groups on an as-requested basis.

Canada’s Export Development Corporation (EDC) has developed a corporate social responsibility framework to make CSR an integral part of its corporate strategy. Through its Corporate Plan, EDC will promote corporate social responsibility principles and standards, including the recommendations of the Guidelines. EDC will establish a link between its website and that of Canada's NCP.

Canada’s NCP has not received notice of any specific instances of MNE conduct in relation to the Guidelines since June 2000.

A draft paper has been prepared laying out the approach Canada’s NCP plans to adopt in responding to cases. This approach closely mirrors the approach provided in the Guidelines’ Procedural Guidance document. Comments were solicited from the CCIB, CLC and CSN. The paper will be posted on the website to allow other organizations a chance to provide input as well.

Progress has been made in improving the visibility, accessibility, transparency and accountability of Canada’s NCP. The establishment of the website and the broader interdepartmental structure of the NCP have made an important contribution in this regard. Promotional activities have been carried out with business, labour and NGOs, and more such activities will take place in the coming year.