Corporate reporting and disclosure

Statutory and regulatory requirements

Are businesses in your jurisdiction subject to any statutory or regulatory human rights-related reporting or disclosure requirements?

Under Canadian securities laws, public companies must disclose all information, including information about environmental and social issues that are material to an investor. The Toronto Stock Exchange and TSX Venture Exchange further require that material information be immediately disclosed in accordance with their timely disclosure policies.

Canada has implemented procurement-related requirements for suppliers contracting with the Canadian federal government. All clothing and textile suppliers contracting with the federal government are required to self-certify that they conduct their business in accordance with fundamental human and labour rights, including freedom from child labour, forced labour, and discrimination and abuse. Further to Canada's commitment to preventing human trafficking in federal procurement supply chains, the government recently amended the Code of Conduct for Procurement applicable to suppliers to integrate human and labour rights expectations.

There is also growing political momentum in Canada to impose statutory reporting and compliance obligations on Canadian companies for modern slavery and human trafficking in supply chains. In November 2021, a private bill (Bill S-211: An Act to Enact the Fighting against Forced Labour and Child Labour in Supply Chains Act and to Amend the Customs Tariff) was reintroduced in the Canadian Senate. It is anticipated that some form of supply chain legislation will be on the current government's legislative agenda.

What is the nature and extent of the required reporting or disclosure?

Aside from environmental and social matters determined to be material, Canadian securities regulators have not specifically mandated the disclosure of environmental and social issues in a reporting issuer’s public disclosure record. Certain industry associations, such as the Mining Association of Canada, require members to report on their corporate social responsibility performance.

Canada’s transparency reporting legislation, the Extractive Sector Transparency Measures Act (ESTMA), imposes mandatory reporting obligations on oil, gas and mining companies. Quebec has similar legislation: the Act Respecting Transparency Measures in the Mining, Oil and Gas Industries. Under the ESTMA, all reporting companies are required to report on an annual basis all payments made to governments in Canada and abroad, including indigenous governments, and state-owned entities where the payments are made in relation to the commercial development of oil, gas or minerals and the payment amount is C$100,000 or more to a single payee.

Which bodies enforce these requirements, and what is the extent of their powers?

Canadian securities regulators are responsible for enforcing disclosure requirements imposed on securities issuers.

The federal department Natural Resources Canada administers the ESTMA and, in cases of wilful non-compliance, may recommend prosecution to the Director of Public Prosecutions. If the entity is found guilty, the ESTMA provides for fines of up to C$250,000 per day per offence.

Voluntary standards

What voluntary standards should businesses refer to for guidance on best practice in relation to any applicable human rights-related corporate reporting and disclosure regimes?

As part of ‘Doing Business the Canadian Way: A Strategy to Advance Corporate Social Responsibility in Canada’s Mining Sector Abroad’, the Canadian government has specifically endorsed the Global Reporting Initiative international reporting standard. However, in the absence of statutory requirements, Canadian companies are able to choose a reporting framework that best enables them to meet the information demands of their stakeholders and any reporting obligations mandated by law, policy or membership with an industry association.

Corporate due diligence

Statutory and regulatory requirements

Are businesses in your jurisdiction subject to any statutory or regulatory human rights-related due diligence requirements?

There are no express statutory obligations in Canada requiring businesses to engage in corporate due diligence in respect of human rights matters.

What is the nature and extent of the required due diligence?

There are no express statutory obligations in Canada requiring businesses to engage in corporate due diligence in respect of human rights matters.

Which bodies enforce these requirements, and what is the extent of their powers?

There are no express statutory obligations in Canada requiring businesses to engage in corporate due diligence in respect of human rights matters.

What voluntary standards should businesses refer to for guidance on best practice in relation to any applicable human-rights related corporate due diligence regimes?

Canadian businesses may choose to align with a number of different voluntary international regimes that promote or require human rights-related due diligence activities, including:

  • the United Nations Guiding Principles on Business and Human Rights;
  • the Voluntary Principles for Security and Human Rights;
  • the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises; and
  • the OECD Due Diligence Guidance for Responsible Business Conduct.

 

Canada is the home jurisdiction of a number of businesses that are internationally active in mining, energy and other extractive industries. As a result, a number of sector-specific voluntary regimes that emphasise human rights-related due diligence are applicable to Canadian businesses, including:

  • the Mining Association of Canada’s Towards Sustainable Mining initiative;
  • the International Council on Mining and Metals’ performance expectations; and
  • the World Gold Council Responsible Gold Mining Principles Assurance Framework.

 

Law stated date

Correct as of

Give the date on which the information above is accurate.

January 2020.