Vale’s Billion Dollar Bonus – Another Example of EDC’s Faulty CSR

Jamie Kneen Communications and Outreach Coordinator responsible for: strategic research, social media, and public engagement; our Africa program, environmental assessment, and uranium mining.

On October 4, 2010, Export Development Canada (EDC) announced that it would provide up to a billion dollars in loans to international mining giant Vale. Half of the amount is targeted to projects at former Inco facilities in Canada; the other half will be available for operations outside Canada but that use Canadian goods and services, or to support exports involving Canadian suppliers. EDC is a Crown corporation that provides financial services including political risk insurance, loans, and loan guarantees to Canadian companies and their customers.

The EDC press release announcing the loans commented on Vale’s commitment to Canadian suppliers. Many have, however, questioned why Vale should be the beneficiary of a loan from a public agency when its commitment to Canadian workers and the environment are not to be congratulated. While EDC’s self-financing model means that Canadian taxpayer dollars are not being funnelled to Vale, as a Crown corporation EDC should ensure that it is supporting companies that operate to a high standard of ethics, labour relations, and environmental performance (sometimes referred to as “CSR” – corporate social responsibility).

In July 2009 United Steel Workers (USW) members at Vale’s Sudbury operations began what would end up being their longest strike ever. In a town fraught with a history of labour disputes that’s saying something! The strike lasted nearly a full year and the workers have successfully requested that Vale be required to go before the Ontario Labour Relations Board to explain the company’s inflexibility in negotiating the return of eight workers dismissed during the strike.

In August 2009 USW members at Vale’s Voisey’s Bay mine in Labrador went on strike. Despite announcing a $6-billion third quarter profit in 2010, Vale continues to try and push down wages and benefits for workers, who are still on strike. A recent press release from the USW notes that the workers “have repeatedly offered to settle the 15-month strike by accepting the same deal Vale reached this summer with its Ontario workers. Vale has refused to offer the same deal, preferring to see the 455-day labour dispute continue unless Newfoundland and Labrador workers accept a lesser contract.”

On the environment side Vale has been avoiding compliance of new emissions requirements in Ontario and is planning on using a prime trophy brook trout lake, Sandy Pond, as a waste dump for nickel processing waste in Long Harbour, Newfoundland Labrador (see Sandy Pond Alliance item in this newsletter).

In addition to concerns here in Canada, Vale also has a long list of international social and environmental conflicts; visit our web site, www.minesandcommunities.org, or the strikers’ web site for more information.