News and resources for Canada's top financial advisors
Filed by Doug Watt, Advisor.ca, doug.watt@advisor.rogers.com
(08/17/05)
 |
(August 17, 2005) With oil prices booming, Canadian energy companies are on the hunt for new markets. But there are hidden dangers in many countries where fossil fuels are prevalent, according to a recent report produced by Ethical Funds.
According to the report, 24 Canadian energy and mining companies operate in 17 countries where human rights violations are endemic. Together, those companies represent a total market capitalization of $168 billion. And most lack effective policies related to human rights and risk disclosure, Ethical says.
The report recommends that companies make an effort to minimize legal liabilities by putting in place a full suite of due diligence procedures, to protect human rights and safeguard corporate interests.
“Crimes against humanity, war crimes and genocide represent the most significant legal liabilities today,” the report warns. “New human rights liabilities will arise in future.”
“The potential financial damage to companies due to more rigorous applications of international human rights law should be of interest to directors and shareholders,” adds Robert Walker, vice president, sustainability at Ethical Funds. “As leaders in global mining and energy, Canadian companies are going where the resources are abundant but where breaches of human rights are more likely. The risk may affect the value of these companies’ international operations.”
Walker also notes that Canada is recognized as a champion of human rights issues, and says Canadian firms can show leadership by staying in front of current legal trends. “Canadian companies without the safeguards to mitigate the risk are overly exposed to human rights violations.”
Ethical Funds says it is not condemning companies for being active in at-risk countries. “Mining and energy companies are compelled to go to where the resources are found. The point is not that they should avoid these countries, but that they need policies and management systems in place.”
Ethical Funds’ recommendations for companies to help lessen their exposure to human rights vulnerabilities include:
Filed by Doug Watt, Advisor.ca, doug.watt@advisor.rogers.com
(08/17/05)
|
(August 17, 2005) With oil prices booming, Canadian energy companies are on the hunt for new markets. But there are hidden dangers in many countries where fossil fuels are prevalent, according to a recent report produced by Ethical Funds.
According to the report, 24 Canadian energy and mining companies operate in 17 countries where human rights violations are endemic. Together, those companies represent a total market capitalization of $168 billion. And most lack effective policies related to human rights and risk disclosure, Ethical says.
The report recommends that companies make an effort to minimize legal liabilities by putting in place a full suite of due diligence procedures, to protect human rights and safeguard corporate interests.
“Crimes against humanity, war crimes and genocide represent the most significant legal liabilities today,” the report warns. “New human rights liabilities will arise in future.”
“The potential financial damage to companies due to more rigorous applications of international human rights law should be of interest to directors and shareholders,” adds Robert Walker, vice president, sustainability at Ethical Funds. “As leaders in global mining and energy, Canadian companies are going where the resources are abundant but where breaches of human rights are more likely. The risk may affect the value of these companies’ international operations.”
Walker also notes that Canada is recognized as a champion of human rights issues, and says Canadian firms can show leadership by staying in front of current legal trends. “Canadian companies without the safeguards to mitigate the risk are overly exposed to human rights violations.”
Ethical Funds says it is not condemning companies for being active in at-risk countries. “Mining and energy companies are compelled to go to where the resources are found. The point is not that they should avoid these countries, but that they need policies and management systems in place.”
Ethical Funds’ recommendations for companies to help lessen their exposure to human rights vulnerabilities include:
Filed by Doug Watt, Advisor.ca, doug.watt@advisor.rogers.com
(08/17/05)
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